JD Sports Fashion PLC (LSE:JD., OTC:JDSPY) has warned that profits this year would be at the lower end of expectations despite what it called a “solid” third quarter performance, as signs of weakening consumer confidence start to show in its key markets.
The sportswear retailer's like-for-like sales for the 13 weeks to 1 November fell by 1.7%, or rose 8.1% when acquisitions are included.
Total LFL sales for the first nine months of its financial year are down 2.2%, with total sales up 15.7%.
JD said it pointed to weaker economic and consumer indicators and now expects profit before tax and adjusting items for the year to be at the lower end of market expectations. The current market consensus is for a profit of £871 million, with a range of £853-888 million.
Chief executive Régis Schultz said: “In the near term, as we enter an important trading period, we are mindful of recent weak macro and consumer indicators in our key markets. These lead us to take a pragmatic approach for our FY26 profit outturn.”
He said the group "continued to make good progress with our strategic objectives in the quarter, against what remains a tough market backdrop. Our multi-brand and cross-category approach, and agility in responding to changing customer trends, are helping us to offset known consumer and industry headwinds.
"We are also controlling our costs and cash well through our focus on operating and financial discipline."
North America, which makes up more than a third of the group’s sales, improved from the second quarter, though LFL sales were still down 1.7%. Excluding the Finish Line business, which it is gradually converting to the JD brand, LFL sales dipped just 0.2%.
European LFL sales were down 1.1% and in the UK were down 3.3%, though this was an improvement on the second quarter.
Gross profit margins contracted 30 basis points compared with the same period last year, excluding acquisitions, due to ongoing price promotions online. Across the whole group, margins declined 40bps.