Following today’s release of JD Sports’ figures for the 26 weeks ending 3rd August 2024; Alice Price, Associate Apparel Analyst at GlobalData, a leading data and analytics company, offers her view: “JD Sports’ latest results attest to the continued slowdown in sportswear demand, with like-for-like (l-f-l) revenue in H1 FY2024/25 rising just 0.7%. This was marred by subdued sales at the beginning of the year when l-f-l revenue declined 0.7%, followed by a rise of 2.4% in Q2. Group revenue rose a respectable 5.2% to £5.0bn, driven by JD’s international store rollout, and supported by its acquisition of Hibbett, which completed just before the period end, and contributed £61m in revenue in just 10 days of trading.
“Its JD fascia, which accounts for 71% of total revenue, experienced l-f-l revenue growth of just 0.6%, as consumers cut back as their budgets remain squeezed. The retailer also continues to be hit by Nike’s sales slump, with the sportswear brand’s revenue plummeting 10.4% in Q1 FY2024/25 ending 31 August 2024, as it grapples with an innovation lag and struggles to stave off disrupters such as HOKA and On. While mass market sportswear players have faltered, premium brands have remained more resilient, so JD should follow a similar strategy to competitor Sports Direct and onboard more desirable premium names to capture demand. Its Sporting Goods and Outdoor division also saw l-f-l revenue rise just 0.6%, as the desirability of staycations continues to wane post-pandemic, while its Complementary Concepts segment was most resilient, growing by 3.4%, as both DTLR and Shoe Palace benefit from ongoing demand for streetwear styles.
“North America continued to drive growth across the period, with sales rising 15.8%, while revenue in Europe rose a respectable 5.9%, as the regions benefit from improved consumer sentiment as inflation eases, alongside JD’s comprehensive store expansion strategy. North America now represents JD Sports’ biggest region in terms of revenue, accounting for 35%. While UK trading improved across the period, sales fell 4.3%, with its performance held back by the underperformance of its apparel category – which has a particularly high mix in the region – coupled with subdued online demand. Asia Pacific also saw sales decline 3.9%, as consumers remain more loyal to domestic players such as Anta and Li-Ning.
“Despite JD Sports’ focus on enhancing its omnichannel proposition through initiatives such as ‘click and collect’ and ‘ship from store’, its online sales fell 1.5%, as it continues to see a shift back to physical stores post-pandemic. Instore demand remained strong, with sales rising 9.2%, as the group offers an elevated experience through elements like instore DJs and digital tablets connected to its e-commerce site to help customers find the right size and colour if not available in that location.”
