JD Sports Fashion Plc, the parent of the JD, Finish Line, DTLR, and Shoe Palace retail brands in the U.S. and JD and others worldwide, reported that revenues grew 6.0 percent on a constant-currency organic basis for the 22-week period ended December 30, 2023. 

Comp store sales growth was just 1.8 percent for the period. 

The company said the results were slightly behind expectations.

JD shares were down 23 percent in British Pound Sterling terms on the London Stock Exchange on Thursday.

“We have made good progress against our five-year strategic plan, delivering global organic revenue growth of 6 percent in the period, against very tough comparisons with last year, and opening over 200 new JD stores in the year,” stated company CEO Régis Schultz. “Our key markets have seen increased promotional activity during the peak trading season, driven by a more cautious consumer, but we continue to grow market share. We are confident in our strategy, and we continue to invest in our supply chain, systems, and stores, supported by our strong cash generation and healthy balance sheet.”

JD Sports reported that apparel revenue growth has been impacted by milder weather since the back half of September, while the peak holiday selling season across the market was said to be softer and more promotional than anticipated, reflecting “more cautious consumer spending.”

JD expects full-year organic revenue growth to be approximately 8 percent for the fiscal year ending February 3, 2024.

The gross margin rate for the 22-week period was said to be “in line with last year;” this is reportedly lower than expectations due to the elevated level of promotional activity during the holiday selling season. Consequently, JD said it now anticipates the full-year gross margin rate will be slightly lower than last year.

Fiscal 2024 is also expected to be impacted by a reclassification of certain capital expenditures into operating expenses, expected to be £7 million, and lower interest income of £8 million following the ISRG NCI acquisition, as well as the previously announced dual running infrastructure costs.

JD now estimates profit before tax and adjusted items to be between £915 million and £935 million. The company said it remains comfortable with its current inventory position.

JD Sports plans to release a full-year update in March, including its initial guidance for Fiscal 2025.

Image courtesy JD Sports