Retail conglomerate Frasers stated today that it was heading into the Christmas trading period with “great momentum” after seeing robust trading in its Sports Direct chain and international businesses during its first half period.
Over the 26 weeks to 29 October, the group’s retail revenue increased by 4.0% to £2.68bn, boosted by recent acquisitions. Trading profit climbed 25.7% to £364.7m after an improvement in retail gross margin from 40.5% to 41.8%.
Sales in its UK Sports Retail division were up 0.8% to £1.49bn, while International Retail sales leapt 13.2% to £645.8m. Sales in its Premium Lifestyle unit rose by 3.1% to £550.1m, with the impact of planned House of Fraser store closures and a softer luxury market offset by sales from the businesses acquired from JD Sports last year.
Frasers noted that robust trading performance from Sports Direct mitigated a decline in its Game UK and Studio Retail businesses.
“This strong trading momentum continued throughout the first half of FY24 and into the early recent weeks of the second half, especially at Sports Direct,” said CEO Michael Murray.
“We are looking forward to our Christmas trading period and remain confident of achieving adjusted pre-tax profit in the range £500-£550m.
He did caution that progress in its Premium Lifestyle business was likely to remain subdued for the short to medium term in the face of a softer luxury market, although he remained confident of long-term prospects.
NAM Implications:
- International Retail sales appears to be the place to be, with sales up 13.2% to £645.8m.
- Meanwhile, suppliers to other parts of the Fraser Group that can produce above average growth…
- …have to appeal as priorities in the buyers’ eyes.
