Frasers Group, the parent company of Everlast, Slazenger, the Sports Direct retail business in the U.K., and former owner of Bob’s Stores and Eastern Mountain Sports in the U.S., got a lift from acquisitions, the Bob’s and EMS sale last year, and the 53rd week in the fiscal year ended April 30 to post mid-teens revenue growth while reporting profits that nearly doubled for the year.

Consolidated revenues grew 15.8 percent to £5.57 billion from £4.81 billion in the 2022 fiscal year. The growth comes on top of 30.9 percent in the prior year.

U.K. Sports Retail, led by Sports Direct, saw sales climb 16.7 percent to £3.08 billion, mainly due to the full-year acquisition of Frasers Group Financial Services, which was acquired in February 2022. Excluding acquisitions, and the 53rd week, revenue was reasonably flat, up just 0.8 percent for the year.

Premium Lifestyle revenue increased 14.8 percent to £1.21 billion, with the impact of planned Frasers store closures more than offset by new Flannels stores and continued online growth. Excluding acquisitions, and the 53rd week, revenue increased 5.7 percent for the year.

International Retail revenue increased 15.2 percent to £1.08 billion, stemming from the acquisition of Sportmaster in May 2022 and an increase in the Malaysian business, offset by the reduction in revenue of its former U.S. retail businesses. Excluding acquisitions, disposals and the 53rd week, revenue increased 2.4 percent for the year on a currency-neutral basis.

  • In May 2022, Frasers Group offloaded its U.S. retail businesses trading under the Bob’s Stores and Eastern Mountain Sports banners for $70 million in cash to GoDigital Media Group (read SGB Media’s coverage here). Frasers Group acquired Bob’s and EMS in April 2017 as part of its bid to boost its U.S. portfolio.

Wholesale and Licensing revenues grew 12.0 percent to £188.3 million. The segment includes several sports brands, including Everlast, Karrimor and Slazenger.

Group gross margin declined 90 basis points to 42.6 percent of sales, which was said to reflect the improvement in Sports Direct’s margins due to product mix, offset by the impact of the House of Fraser stores closures, brand consolidation and a very strong post-COVID comparative of full-price sales.

U.K. Sports Retail gross margins expanded 180 basis points to 44.9 percent of sales, reflecting an improved product mix in the core Sports Direct business due to strengthening brand relationships.

Adjusted Profit Before Tax (ABPT) was £478.1 million compared to £339.8 million in FY22. The key driver for the4 APBT growth was said to be powered by “the core Sports Direct business driven by the continuing success of the elevation strategy.” The company said there were property impairments of £99.6 million and tangible impairments of £140.1 million, which were largely offset by £138.3 million in gains on disposal of properties and subsidiaries and £95.0 million in reversals of legal and regulatory provisions.

U.K.Sports Retail APBT was £447.0 million in fiscal 2023, representing a 127 percent increase versus the prior year. The significant gain was said to be due to the expansion of gross margins and profits from the disposal of properties.

Reported Profit After Tax was £501.3 million, or 106.1 pence per share, in fiscal 2023l, up 95.1 percent from £256.9 million, or 52.9 pence per share, in the prior year.

Adjusted EPS was up 31.5 percent to 70.9 pence.

Photo courtesy Sports Direct