Sports fashion retailer JD Sports has issued a significant warning that its annual profits are likely to fall at the lower end of market expectations, citing the dual pressures of rising unemployment in the UK and an unusually warm autumn season.
Sales Slump Across Key Markets
The group reported a continued decline in sales across its most important markets. In the UK, like-for-like sales dropped by 3.3% during the third quarter, which ended on 1 November. While this performance was an improvement on the 6.1% fall recorded in the previous three months, it underscores the persistent challenges facing the retailer.
JD Sports explicitly pointed to 'pressures on our core customer demographic, including rising unemployment levels' as a primary cause for concern, alongside general volatility in consumer confidence.
Revised Profit Expectations and Festive Season Caution
With the crucial Christmas trading period on the horizon, the company has adopted a cautious stance. JD Sports now anticipates that its underlying pre-tax profits for the year will land 'within the lower end of current market expectations'.
These expectations currently range between £853 million and £888 million. If this projection holds, it would represent a substantial decrease from the £923 million in pre-tax profits reported the previous year.
Executive Commentary and Regional Performance
Chief Executive Regis Schultz commented on the situation, stating, "As we enter an important trading period, we are mindful of recent weak macro and consumer indicators in our key markets. These lead us to take a pragmatic approach for our full-year 2025/26 profit outturn."
He did, however, highlight the company's resilience, adding that its "multi-brand and cross-category approach, and agility in responding to changing customer trends, are helping us to offset known consumer and industry headwinds."
The retailer noted that its clothing and outdoor ranges were particularly affected during September, a period of 'unseasonably warmer weather'. Footwear sales also continued to face challenges. A bright spot was the 'continued success' of its new flagship store at the Trafford Centre in Manchester, which provided a welcome boost.
On a global scale, overall group sales dipped by 1.7% in the third quarter. North America saw a decline of 1.7%, while Europe experienced a 1.1% fall. The Asia Pacific region was the sole area of growth, with sales rising by 3.9%.
In a statement summarising the year's challenges, JD Sports said it has operated "amid macroeconomic volatility, strained consumer finances, and evolving brand product cycles" across all its global markets.
