JD Sports has restarted dividend payments to shareholders after profits were shored up by bumper lockdown demand for trainers and hoodies, but says it has no plans to return taxpayer cash.
On Tuesday the sportswear group reported annual sales and profits within touching distance of those banked in the year before the pandemic struck, as shoppers switched to its websites when high streets were closed.
Pretax profits before one-offs came in at £421m on sales that were up slightly at £6.2bn in the year to 30 January. However, despite the strong performance – which increased the group’s profits forecast for the coming year – Peter Cowgill, JD’s executive chairman, said the company would not be repaying government cash.
Without furlough support and other public sector initiatives it is “likely we would have had to make tens of thousands of our colleagues, particularly those who work in stores, redundant”, the company said. It did not disclose how much financial help it had received. JD finished the year with almost £800m in the bank.
The shares had risen 2% at the time of writing to a record 932p. Just before the pandemic hit last year the shares were changing hands at about 880p, before crashing to 293p in March as lockdown loomed.
JD, which also owns Size?, Blacks Leisure, Millets and Go Outdoors as well as Finish Line in the US, said shareholder payments had resumed with a final dividend payment of 1.44p a share worth £14.8m.
Cowgill said the pandemic, coupled with Brexit, had severely tested the resilience of the business, but as “we begin to emerge from the worst of the disruption, JD is at the pinnacle of the global sports fashion industry”.
Indeed, as shops reopened in England and Wales on Monday its stores were among those to attract the biggest queues as young shoppers clamoured to get their hands on limited-edition trainers.
JD also upped its profits forecast for the coming year to between £475m and £500m, compared with a previous guide of £440m to £450m. Amisha Chohan, a Quilter Cheviot analyst, said it had not been surprising that demand for athleisure gear had “remained high in a year where we were told to both stay and work from home”.
Chohan said big footwear brands had delayed trainer launches in 2020. With many of these releases primed for 2021, JD was ready to cash in on the expected spending spree. She added: “JD is best positioned for a strong and fast recovery given its regional mix and growing evidence of accelerating consumer demand for sneakers.”