Summary: First-half profit rises 12.6% Confident of making 500 mln-550 mln stg in full year
Frasers (FRAS.L), the British sportswear and apparel retailer that owns the Sports Direct brand, said it was on track to meet full-year profit guidance after first-half earnings rose 12.6%, reflecting the success of a plan to take the group upmarket.
The FTSE 100-listed group controlled by Mike Ashley said on Thursday it was confident of achieving adjusted pretax profit of 500 million to 550 million pounds ($628 million-$690 million) in the year to April 2024, up from 478 million pounds a year before.
It made 303.8 million pounds in its first half to Oct. 29 on revenue that rose 4.4% to 2.77 billion pounds.
The group is pursuing a so-called “elevation strategy” with investments in flagship stores and in online operations, and the deepening of ties with brands such as Nike (NKE.N) and Adidas (ADSGn.DE).
Frasers’ brands also include House of Fraser, Flannels, USC and Jack Wills, and it holds strategic equity stakes in a raft of other retailers including Hugo Boss (BOSSn.DE), ASOS (ASOS.L), Boohoo (BOOH.L), Currys (CURY.L) and AO World (AO.L).
Industry data published on Tuesday showed British retail sales growth remained sluggish in November despite Black Friday deals as the ongoing cost-of-living squeeze prompted shoppers to rein in spending on non-essential items.
However, Frasers said its strong trading momentum had continued into the early weeks of its second half, especially at Sports Direct.
“The elevation strategy continues to drive strong trading performance across the business,” said CEO Michael Murray, Ashley’s son-in-law.
He said Frasers’ long-term ambitions for its Premium Lifestyle business were unchanged, although he cautioned that progress was likely to remain subdued for the short to medium term in the face of a softer luxury market.
Shares in Frasers, 73% of which are owned by Ashley, are up 28% in 2023.
($1 = 0.7966 pounds)
Reporting by James Davey; Editing by Sarah Young and Jan Harvey
