Frasers Group PLC (LSE:FRAS) shares jumped 20% after the retailer reported a strong performance for the year to April and said it expects 'healthy growth" in profits this year.
The Sports Direct-owner posted adjusted pre-tax profits of £344.8mln for the year to 24 April 2022, compared to a loss of £39.9mln the year before. Group revenue was up almost 31% at £4.74bn, boosted by the reopening of stores after lockdown.
Despite the challenging economic backdrop, the company said it is confident of achieving “healthy growth” in adjusted pre-tax profit to £450mln-£500mln for the current financial year.
"I am really proud of the record performance we've announced today,” said chief executive Michael Murray, who took over from his father-in-law Mike Ashley last year.
“It's clear that our elevation strategy is working and we are building incredible momentum with new store openings, digital capabilities and deeper brand partnerships across all of our divisions.”
UK Sports Retail revenue increased 31.2% during the year, driven by the reopening of stores after the Covid-19 pandemic lockdown, while Premium Lifestyle revenue increased by 43.6%, reflecting the opening of new FLANNELS stores, Frasers said.
It said it has been affected by inflationary pressures and supply chain disruption, and Murray called for reform of the UK’s "archaic business rates regime".
“As well as the significant increase in general running costs, we are fighting against a fundamentally flawed business rates system which is yet to be addressed. Linked to these are the cost-of-living pressures facing many of our consumers,” he said.
Shares were 19.67% higher at 897.50p in late morning trade.