The JD Sports Fashion PLC (LON:JD) (JD.L) share price has gained around 7% today after it released results for the year to 3 February 2018.
It was a record set of results for the retailer, with headline profit before tax and exceptional items of £307.4 million. Its profit before tax increased by 24%, with LFL store sales growth being 3%. This was boosted by growth in LFL website sales which was over 30%.
The growth of the company’s estate in international markets has continued. There was a net increase of 56 stores across Europe, while a further 9 stores were opened in the Asia Pacific region during the year.
JD experienced encouraging performance in its Outdoor division, where EBITDA was £23 million. It has continued to invest in its operations, with an additional capex of £100 million being recorded in the year. It has made increased investment in retail stores and in warehouse infrastructure to facilitate further growth.
Today’s results also confirm that terms have been agreed to acquire The Finish Line. It has 931 branded stores in the US, although the deal is still subject to shareholder approval.
In the last 6 months the JD share price has risen by 5%. That’s a better performance than other retail stocks such as Marks and Spencer Group Plc (LON:MKS) (MKS.L) and Sports Direct International Plc (LON:SPD) (SPD.L). Marks and Spencer’s share price is down 20%, while the Sports Direct share price has moved 4% lower.
In my view, JD is performing well and seems to have further growth potential. Its growth in international markets suggests that it could have significant scope to increase the size of its operations abroad, with the potential acquisition of The Finish Line having the capacity to act as a growth catalyst over the medium term.
Although the prospects for the business in the UK may be tough due to declining consumer confidence, the international focus of the business means it could deliver further stock price growth in my opinion.