Sports Direct sees annual profits rise to £300 millon

Sports Direct.
Sports Direct.

Shirebrook based Sports Direct has seen its pre-tax profit rise to more than £300m.

The retail giant owned by billionaire Mike Ashley released its full year results this week and also addressed questions about employee rights uncovered in a recent Channel 4 documentary.

The company, which is the area’s biggest employer with a workforce of 5,000 at its Shirebrook headquarters has also come under fire for attracting thousands of Eastern European workers to the employment blackspot.

Sports Direct generated £2.3bn sales in the year to 26th April 2015 compared to £2.7bn for the year to 27th April 2014.

The pre tax profit increased from £240m to £314m.

An adjusted measure of pre-tax profits that City analysts follow rose 21 per cent to £300m, slightly beating forecasts.

Chief executive Dave Forsey hailed the performance as “another solid set of results in spite of challenging trading conditions”.

These included the adverse impact on performance during the period of England’s early departure from the FIFA World Cup and “unseasonably mild weather” during autumn, which reduced footfall.

Sales in the premium lifestyle division, which includes the results of the premium retail businesses such as Republic, Cruise and USC, decreased from £214m to £208m due to the closure of loss-making stores in the year.

The brands operation with big names such as Everlast, Lonsdale and Dunlop, reported a revenue rise from £218m to £226m.

The retail giant increased its store portfolio in the UK by 23 stores during the year, opening 39 but closing 16, and added a further nine stores to its European operations by opening 16 and closing seven.

The Secrets of Sports Direct aired on 27th April alleged that staff performance is underpinned by a ‘six strikes and you’re out’ system, with offences including being off sick and not working fast enough.

The documentary also estimated that just 300 of 5,000 staff employed at Sports Direct’s head office in Shirebrook have contracts with the company, while the remainder are employed on a zero hours basis.

chairman Keith Hellawell said: “Much of the comment regarding the group’s use of zero hour contracts has been unfounded and inaccurate.

“We comply fully with all legal requirements which relate to casual workers, including sick pay, holiday pay, and freedom to gain other employment. Casual workers also participate in general incentive schemes.”