JD Sports Fashion sees profit at lower end of range after 'volatile' October

(Sharecast News) - JD Sports Fashion warned full-year profits would be at the lower end of its forecast range after a "volatile" trading environment in October due to bigger discounts, milder weather and consumer caution ahead of the US election. Third quarter like-for-like sales fell by 0.3%, while organic group revenue was up 5.4%, the company said in a trading update on Thursday. JD Sports forecast annual profit before tax and adjusting items in a range of £955m - £1.035bn.

Regionally, like-for-like sales fell 2.4% in the UK, 1.5% in the Americas and 3.8% in Asia Pacific. Europe bucked the trend with a 3.5% increase in the 13 weeks to November 2.

"We had a strong back-to-school period but we saw much softer consumer demand and trading toward the end of the period, reflecting elevated promotional activity, unseasonable weather and a cautious consumer, with evidence supporting suppressed demand in the US ahead of the election," said chief executive Regis Schultz.

"Against this backdrop, we maintained our operating discipline to deliver on our long-term commercial strategy rather than a short-term sales focus."

As a result, Schultz said, gross margin increased 0.3 percentage points to 48.1% with the year-to-date figure now at 48.2%, in line with the corresponding period.

Reporting by Frank Prenesti for Sharecast.com