JD Sports maintains strong sales performance due to online

JD Sports has reported a “significant retention of sales” during the Covid-19 pandemic in a trading update for the 26 weeks ended 1 August 2020, which it largely attributes to a revenue shift to its online channels.

The sports fashion retailer revealed revenue fell by £176.3 million compared with the same period last year, but was encouraged that it was able to retain over 90% of revenues despite the closure of the majority of its physical store estate for up to three months.

JD Sports said its long-term investment in digital has enabled customers to make an easy switch to online shopping during the lockdown period. In the six months up to 1 August, it has also invested in its Kingsway warehouse in Rochdale to further enhance its online fulfilment processes.

And it intends to continue expanding its online capabilities going forward, stating that “it is perhaps inevitable that the outbreak of Covid-19 will lead to an acceleration in the transfer of revenues from physical retail to online”.

The retailer acknowledged that while it was “generally encouraged” by its stores’ performance since reopening, footfall remains weak with Covid-19 remaining a significant  challenge.

Peter Cowgill, executive chairman at JD Sports commented: "Ultimately, given the unique circumstances of this trading period, we are reassured by the strength of the JD brand as demonstrated by the retention of more than 90% of the total revenues. However, it should be recognised that this has necessitated additional costs principally relating to the provision of enhanced health and safety measures, in all areas of the business, together with increased costs of online fulfilment, including performance marketing.

“Whilst these additional costs have impacted on the result for the period, the group has retained a significant level of profitability with a profit before tax and exceptional items of £61.9 million (2019: £158.6 million).”

In its previous trading update published in July, JD Sports outlined plans to become more digitally focused following the pandemic.