Shirebrook-based sports retailer Sports Direct has announced a huge drop in profits.
In its newly published preliminary results for the last financial year, the high street giant reported that while group revenue was up 11.7 per cent to £3.2 billion, underlying profits before tax were down nearly 60 per cent, from £275.2 million to £113.7m.
In the report, the firm said this was “largely due to currency movements and increased depreciation charges”, after it was exposed to heavy falls in the pound following the UK’s Brexit vote.
However, while earnings are expected to remain volatile amid “uncertainty surrounding Brexit”, the firm is expecting small growth in the current financial year.
Mike Ashley, company founder, owner and chief executive, said: “Sports Direct is on course to become the ‘Selfridges’ of sport by migrating to a new generation of stores to showcase the very best products from our third party brand partners.
“We have invested more than £300m in property over the last year, and I am pleased to report early indications show trading in our new flagship stores is exceeding expectations.”
Sports Direct last year apologised for “serious shortcomings” in its working practices at its Shirebrook warehouse as it announced a full review of its practices following a damning independent report into its conditions.
In the report commissioned by the firm, it apologised for conditions at the warehouse, which have been likened to those of a Victorian workhouse.
The report said: “Serious shortcomings were identified in working practices in warehouse which the Sports Direct board deeply regrets and apologises for.”
It has also pledged to offer casual retail staff at least 12 guaranteed hours a week, instead of zero-hour contracts – but almost all staff at the warehouse are agency workers making them ineligible for the new contract.
The news was a huge victory for the Chad, which first exposed draconian working conditions at the Shirebrook site in 2014, after a migrant worker gave birth in the company toilets on New Year’s Day because she was too scared of losing her job to ask to go home.
Your Chad’s investigation, led by content editor Andy Done-Johnson, was later followed up by the BBC and the Guardian Newspaper, which eventually led to a Parliamentary enquiry.