Sports Direct today said that its focus on developing a new generation of stores while improving its customer offering across all of its channels continued to be key to its strategy, as it reported rising sales but took a profits hit related to its stake in Debenhams.
The sports retailer reported group revenue of £3.6bn in the year to April 29, 3.5% up on the same time last year. In its domestic UK market, sales of £2.2bn were 2% down on last time, while European sales of £637.2m were 0.1% down. But sales grew faster in the rest of the world (£192.4m, +594%) and in its premium lifestyle business, which includes the Flannels, Cruise, and van mildert retail brands (£162.1m, +42.7%). Wholesale and licensing revenue of £186.3m was 22.7% down on last time.
Underlying pre-tax profits came in at £152.9m, 34.5% ahead of the previous year, but after writing down £85.4m in relation to its stake in Debenhams, bottom-line pre-tax profits of £77.5m were 72.5% down on last time.
Chief executive Mike Ashley said: "The high street has come under the spotlight over the course of the year due to the headwinds facing the sector. Due to the changing landscape we have made fewer store acquisitions than in previous financial years as repricing comes further into effect. This restructuring of the retail property sector has opened greater opportunities to enhance our store portfolio across the group fascias. We will continue to make prudent investment into freehold property advance the repositioning of the group’s transition into large format stores. We have echoed good support from local councils and communities for our commitment to physical retail."
Here’s what the retailer, a Top100 retailer in IRUK Top500 research, said about its multichannel strategy.
Spors Direct says it is focusing on improving its offering to customers across all of its channels, from marketing and social media to digital and the store. "This," said Mike Ashley in today’s results, "aims to enable the company, along with our third party brand partners to connect with customers via a consistent voice across multiple platforms, including online, mobile and on the high street. This strategy enables our stores and our online operations to complement each other."
The retailer focus on improvements to its mobile apps during the year. "This activity, combined with innovative marketing initiatives, recently resulted in the mobile app for SportsDirect trending a number one in the Apple App Store shopping category during the closing stages of the World Cup, ahead of tech companies such as Amazon and eBay," it said.
The retailer has now opened 19 new generation stores, including five regional flagship stores, which include a range of retail brands on a single site. "The concept for our flagship stores is constantly evolving based on feedback from customers and our third-party brand partners." At Thurrock, for example, the site includes a SportsDirect.com store, a USC fashion store, a Flannels luxury clothing store and an Everlast gym. It also brings technology into the store, with video merchandising displays operating alongside interactive customer elements, such as the ability to record a 360-degree gif when trying on a new outfit. "Experiential enhancements include recharge areas for men and women, an urban-inspired kids zone with selfie mirror, plus plans for an e-sports arena."