Problems with Nike overshadow record sales at JD Sports

JD Sports said it was ‘very pleased’ Nike has a new boss as the US giant’s problems hang over Britain’s ‘King of Trainers’.

The retailer posted record half-year sales of £5 billion in the 26 weeks to August 3, thanks to strong demand for its shoes.

But shares fell as the bumper numbers were overshadowed by a downbeat update from Nike, which typically makes up nearly half of JD’s sales.

Nike told investors that quarterly sales fell 10 percent this summer due to competition from newer brands.

Company veteran Elliott Hill, who started as an intern at Nike in 1988 and retired in 2020, returns as CEO this month to drive a turnaround.

JD boss Regis Schultz said he was confident Hill would help Nike revive its fortunes. “We are very happy to have him back,” he said.

“It’s good to have someone from the industry who knows Nike and the products.”

Schultz said in March that shoppers were feeling “fatigue” with familiar designs as brands like Hoka and ON — which actress Zendaya promotes — become increasingly popular.

But yesterday he said: ‘We see Nike coming back. Nike will do well. Nike is a strong brand. It’s only a matter of time.’

Outgoing Nike boss John Donahoe blamed a lack of innovative ideas on staff working from home.

JD’s Schultz said selling many different brands, as well as Nike, would protect it.

It said demand for sports shoes boosted sales, but fashion sales in Britain and Europe were hit by bad weather.

Sales in Britain fell 4.6 percent to £1.2 billion in the six months due to a wet summer, which also dampened trading at Primark and H&M.

Profits fell by almost two-thirds to £126.3m over the period, due to one-off costs such as those linked to the takeover of US rival Hibbett and the closure of its Derby warehouse. The company is still on course to become the fourth UK retailer to pass the £1 billion per year mark.

It said it was sticking to a profit target of £955m to £1.03bn, which would see it join a select club that also includes Tesco, M&S and Kingfisher, the only other UK companies with profits above £1bn lie, although Next is also closing. at the milestone.