Following today’s release of JD Sports’ figures for FY2020/21; Emily Salter, senior retail analyst at GlobalData, a leading data and analytics company, offers her view: “JD Sports has emerged from a year of disruption in the enviable position of sales growth, though a minimal rise of £56.5m to £6,167.3m, with only a small fall in its operating profit, protected by its sportswear specialism and strong online offer. The retailer proved to be a clear destination for loungewear and athleisure for young shoppers throughout 2020, and as these consumers start socialising again, demand for items with higher price points such as fashion trainers will rise, boosting its fortunes further.
“International expansion continues to be a priority for JD Sports, which is a smart move to reduce its reliance on Western Europe which remains badly hit by COVID-19. Its main vehicle for overseas growth is acquisitions, with a slew of purchases in the last year including MIG in Poland and Shoe Palace in the US. As the US was the only market in growth in FY2020/21, with sales growing by £169.5m to £1,780.5m, including a nearly 50% boost in sales from May to July due to the government fiscal stimulus, the retailer has clearly gained a loyal shopper base across the region. JD Sports’ future performance in the US will be boosted by the acquisition of DLTR in February, expanding its reach in states across the North and East. Additionally, the opening of JD’s first flagship store in New York’s Times Square will further raise consumer awareness, and will help JD retain its positive reputation among heavyweight brands such as Nike and Adidas, the presence of which are key to its success.
“The retailer’s well established multichannel offer has been a key driver of its success, as its young shoppers are well accustomed to shopping online. Finish Line and JD in the US boasted a 75% retention rate of sales through digital channels during temporary store closures in the first half; with JD in the UK not far behind at 70% retention during the first lockdown, rising to 100% in November. However, this online strength has not necessarily come at the expense of store performance, as like-for-like store sales for JD and Size? in the UK rose by over 4% on the year during August to October, and shoppers were eager to return to JD locations upon store reopenings in England yesterday, with queues spotted outside many of its sites, reinforcing a bright outlook for FY2021/22.”