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JD Sports profits double pre-pandemic levels in record year

// JD Sports profits more than doubled against pre-pandemic levels in a record year for the retailer
// The sportswear giant said it had interviewed a number of “high calibre candidates” to replace Peter Cowgill as CEO. Cowgill was ousted last month amid a slew of regulatory issues for the retailer.

JD Sports profits doubled against pre-pandemic levels in a record year for the retailer as it revealed it has interviewed a number of high calibre candidates for its new CEO.

When removing exceptional items, pre-tax profits hit £947,3m, more than double the retailer’s previous record profit, which was delivered before the pandemic in the year to 1 February 2020.

Despite the cost-of-living crisis, JD Sports interim chair Helen Ashton said it had been encouraged by resilient consumer demand and believes that profits will be in line with this record performance in the current year.

Ashton said it had been a year of “outstanding progress” for JD Sports.

“This result demonstrates our capacity for growth in both existing and new markets, and the strength of our global proposition and consumer engagement in store and online,” she said.

“We are particularly encouraged by the strong performance from the group’s banners in North America. It is increasingly evident that the group’s progress in North America, and the United States in particular, is having a long-term positive impact both on overall performance and its relationships with the international brands.”

The strong results come amid a period of controversy for JD Sports. Long-term boss Peter Cowgill exited the business last month as the retailer came embroiled in regulatory issues.

In February, the CMA hit JD Sports with a fine £4.3m following a secret meeting between Cowgill and Footasylum CEO, and former JD chief executive, Barry Bown.

The CMA was investigating JD’s potential acquisition of Footasylum at the time and said the clandestine meeting in a car park, where commercially sensitive information was shared, breached its rules.

READ MORE: JD Sports facing CMA fine for ‘cartel activity’ on price-fixing

The retailer is also facing a large fine after the CMA provisionally found it had engaged in “cartel activity” by fixing the retail price of football shirts. The CMA has provisionally found evidence of illegal price fixing of Rangers Football Club merchandise that lasted between September 2018 and July 2019.

Ashton addressed the issues. “Balancing the operational requirements of running and growing a business through a global pandemic with the obligations of elevating governance standards has been complex and not without challenge,” she said.

“A number of regulatory issues have arisen through this time which, following a series of independent investigations alongside the completion of the group’s governance review, have highlighted the need for both greater relevant experience on the board and more formalisation in governance systems, risk management recording, the documentation and appraisal of internal controls and the mechanisms for reporting relevant matters to the regulatory authorities where appropriate.”

She said the process to recruit a CEO was ongoing with “a number of high calibre candidates at different stages of consideration including some who have only recently made their interest in the role known”.

The retailer is also recruiting for a non-executive chair, a process Ashton said was “progressing at pace”.

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