Interim Results

John David Sports PLC 27 November 2001 27 November 2001 JOHN DAVID SPORTS PLC ('JD Sports') INTERIM RESULTS FOR THE SIX MONTHS TO 30 SEPTEMBER 2001 JD Sports , the UK's leading specialist retailer of fashionable branded sports and leisure wear, today announces its 2001 Interim Results. Highlights:- * Turnover increased by 18% to £118.35 million (2000: £100.43 million) * Like for like sales increased by 3% * Gross margin improved to 47.3% from 46.5% * Operating profit increased by 15% to £11.05 million (2000: £9.58 million) * Pre tax profit increased by 16% to £10.86 million (2000: £9.32 million) * Basic earnings per ordinary share increased by 18% to 16.16p (2000: 13.65p) * Interim dividend increased by 13% from 2.3p to 2.6p per ordinary share * Additional 15 net store openings increasing the total number to 155 stores * Like for like sales growth of 2% during the 8 weeks since 30 September 2001 John Wardle, Chairman, said: 'I am pleased with our performance in the first half of the year and consider that the company is well placed to deliver continued long-term growth. Our differentiation remains strong as does consumer demand for fashionable, branded merchandise. The opportunity for further growth, via our distinctive retail formats, continues to remain significant.' Enquiries: John David Sports Plc 01706 628000 Barry Bown (Chief Executive) Malcolm Blackhurst (Finance Director) Hogarth Partnership Limited 0207 357 9477 Andrew Jaques Tom Leatherbarrow CHAIRMAN'S STATEMENT I am pleased to report continued good progress in the half year to 30 September 2001, having met all our strategic objectives and financial targets. This improvement has been achieved despite particularly demanding sales comparatives in the interim period last year. JD Sports has remained focused on its differentiated branded products and unique store ambience and has continued to nurture the relationship with our design led and brand conscious consumer. We have also continued to develop and expand the business and strive to further enhance our distinct market position in the retail sector. Our proven retail capabilities and innovative partnerships with leading brands and own brand development, continue to contribute to our successful progression and profitability. RESULTS Total sales increased by 18% to £118.35 million during the period, including like for like sales increases of 3%, meeting our targeted requirements. In addition, gross margin was again improved from 46.5% to 47.3% during the half year. Operating profit increased by 15% to £11.05 million compared with £9.58 million in the half year to 30 September 2000. Net profit before taxation increased by 16% to £10.86 million compared with £ 9.32 million in the previous period. Net interest charges fell from £0.17 million to £0.09 million as a result of reduced average net debt during the period. Basic earnings per ordinary share improved to 16.16p per share - an increase of 18% - over the previous half year's performance of 13.65p per ordinary share. DIVIDEND The Board proposes to pay an increased interim dividend of 2.6p per ordinary share (2000: 2.3p). This uplift represents a 13% increase on the previous period and will be paid on 18 February 2002 to shareholders on the register as at 18 January 2002. OPERATING REVIEW As referred to above, we are pleased to have met our financial targets and strategic objectives for the period under review. Our sales improvements have been achieved against strong comparatives in the same period last year, and particularly in June 2000, which benefited directly from the England football team's participation in the Euro 2000 competition. Our expansion has continued during the period, opening 18 new stores and closing three smaller stores, adding a net 109,000 sq.ft. of retail space in the interim period. At the end of September 2001, therefore, the company traded from 155 stores occupying a total of 589,000 retail sq.ft. This total includes 21 out of town/edge of town stores which occupy 146,000 retail sq.ft. The company provides main brand, fashionable product, supplying a great number of lines exclusive to JD Sports, supported by elements of own brand merchandise. Both main brand and own brand merchandise continue to be enhanced by our in house design capabilities. Our product mix is very similar to the previous period and anticipated to be broadly 50% footwear, 46% clothing and 4% accessories for the year as a whole; this mix is consistent with the previous year. We have remained focused on our in-store formats of JD Casual, JD Woman, JD Junior, JD Exclusives and King of Trainers and marketing campaigns have also remained consistent with these formats. Our larger space formats - in particular - provide a varied and pleasurable shopping experience, in a unique store ambience, displaying lifestyle and desirable sports and leisure fashion wear to our brand conscious consumers. BALANCE SHEET & FINANCIAL RESOURCES Shareholders' funds at the balance sheet date have increased by 23% from £ 41.71 million (30 September 2000) to £51.18 million at the end of September 2001. Total expenditure on fixed assets during the period amounted to £8.34 million (30 September 2000: £3.51 million) of which £7.75 million relates to stores. Net borrowings as at 30 September 2001 were £2.45 million resulting in a modest gearing level of 5% (30 September 2000: nil). BOARD CHANGES We announced at the AGM in early September 2001 that Roger Best and Colin Archer would be joining the Board as non-executive directors and that Michael Adams and Alan White would retire as non-executive directors in the near future. Colin Archer joined the Board with effect from 6 November 2001 and Michael Adams and Alan White retired on the same date. Roger Best will join the Board in January 2002. The Board would like to thank both Michael and Alan for their contribution and support during the past five years and wish them well for the future. Roger Best (age 49) has a great deal of experience in the sports sector, spending the last nine years with Reebok International. His current position at Reebok is Senior Vice President of Europe, Africa and the Middle East, prior to which he held the positions of Senior Vice President - North America and also Managing Director of Reebok U.K. As such, he brings a vast amount of experience to the Board of JD Sports. Colin Archer (age 59) spent the majority of his career with Barclays Bank Plc, rising to a position of Assistant Corporate Director. As such he will provide a wealth of financial advisory experience to the Board. Colin is a member of the Chartered Institute of Bankers and has over forty years experience in the banking and financial arenas. CURRENT TRADING Trading in the eight weeks since 30 September 2001 has produced a total like for like sales performance of 2% despite a weaker performance during October due to the unseasonally warm weather, prevalent during this period. Gross margins have been maintained in line with the previous year's performance, since the period end. Since 30 September 2001, a further seven stores have been opened and one smaller store closed, increasing current retail space to 628,000 sq.ft. and total number of stores to 161. Total out of town/edge of town stores now number 24, occupying 168,000 sq.ft. One further store will be opened by the year end and one smaller store is earmarked for closure after Christmas as a result of relocation. OUTLOOK In common with many retailers, Christmas trading has a significant influence on overall results for the year. It is therefore always difficult to comment on overall prospects for the year at this time. The events of 11 September in the United States undoubtedly add a greater degree of uncertainty. The Board remains confident, however, that our differentiated and branded merchandise, together with our continued strategic focus, will ensure that the long term prospects of the company remain strong. The fundamental strategy of the company remains heavily focused on the progression and expansion of JD Sports. We continue to believe that the format could be extended to 300 sites or more in the future. I am pleased with our performance in the first half of the year and consider that the company is well placed to deliver continued long-term growth. John Wardle Chairman 27 November 2001 PROFIT AND LOSS ACCOUNT for the half year ended 30 September 2001 Note Unaudited Unaudited Audited first half first half year ended 2001 2000 31 March 2001 £000 £000 £000 Turnover 118,347 100,426 204,465 Cost of sales (62,347) (53,754) (109,469) _______ _______ _______ Gross profit 56,000 46,672 94,996 Operating expenses (net) (44,950) (37,092) (78,144) _______ _______ _______ Operating profit 11,050 9,580 16,852 Loss on sale of (105) (83) (95) tangible fixed assets _______ _______ _______ Profits on ordinary 10,945 9,497 16,757 activities before interest Interest receivable and 48 55 154 similar income Interest payable and (134) (228) (443) similar charges _______ _______ _______ Profit on ordinary 10,859 9,324 16,468 activities before taxation Taxation on profit on 2 (3,304) (2,977) (5,120) ordinary activities _______ _______ _______ Profit on ordinary 7,555 6,347 11,348 activities after taxation Dividends paid and 3 (1,215) (1,070) (3,220) proposed _______ _______ _______ Retained profit 6,340 5,277 8,128 _______ _______ _______ Basic earnings per 4 16.16p 13.65p 24.38p ordinary share Diluted earnings per 16.16p 13.63p 24.38p ordinary share _______ _______ _______ All amounts shown relate to continuing operations BALANCE SHEET as at 30 September 2001 Unaudited Unaudited Audited as at as at as at 30 September 30 September 31 March 2001 2000 2001 £000 £000 £000 Fixed assets Tangible assets 39,815 29,282 34,404 _______ _______ _______ Current assets Stocks 35,783 29,839 30,103 Debtors and prepayments 6,052 5,537 5,543 Cash at bank and in hand 197 4,236 869 _______ _______ _______ 42,032 39,612 36,515 Creditors: amounts (25,938) (23,890) (21,572) falling due within one year _______ _______ _______ Net current assets 16,094 15,722 14,943 _______ _______ _______ Total assets less 55,909 45,004 49,347 current liabilities Creditors: amounts (2,041) (1,534) (2,331) falling due after more than one year Provisions for (2,685) (1,764) (2,173) liabilities and charges _______ _______ _______ Net assets 51,183 41,706 44,843 _______ _______ _______ Capital and reserves Called up share capital 2,337 2,325 2,337 Share premium account 8,908 8,634 8,908 Profit and loss account 39,938 30,747 33,598 _______ _______ _______ 51,183 41,706 44,843 Equity shareholders' _______ _______ _______ funds RECONCILIATION OF MOVEMENTS IN EQUITY SHAREHOLDERS' FUNDS as at 30 September 2001 Unaudited Unaudited Audited as at as at as at 30 September 30 September 31 March 2001 2000 2001 £000 £000 £000 Retained profit 6,340 5,277 8,128 Proceeds from issue of - - 286 shares _______ _______ _______ 6,340 5,277 8,414 Opening equity 44,843 36,429 36,429 shareholders' funds _______ _______ _______ Closing equity 51,183 41,706 44,843 shareholders' funds _______ _______ _______ CASH FLOW STATEMENT for the half year ended 30 September 2001 Unaudited Unaudited Audited first half first half year ended 2001 2000 31 March 2001 £000 £000 £000 Net cash inflow from 10,366 12,619 23,210 operating activities Returns on investments and (86) (173) (289) servicing of finance Taxation (1,346) (1,184) (4,462) Capital expenditure (8,256) (2,988) (10,765) Equity dividends paid - - (2,930) _______ _______ _______ Net cash inflow before 678 8,274 4,764 financing Financing (1,656) (2,396) (2,253) _______ _______ _______ (Decrease)/increase in (978) 5,878 2,511 cash _______ _______ _______ NOTES TO THE INTERIM FINANCIAL STATEMENTS 1. The unaudited results have been prepared using the same accounting policies as those used for the financial statements for the year ended 31 March 2001. 2. Taxation has been estimated at the rate expected to be incurred in the full year. 3. The Directors have declared an interim dividend of 2.60p per ordinary share, to be paid on 18 February 2002 to shareholders on the register as at 18 January 2002. 4. Basic earnings per ordinary share represent the profit for the period of £7,555,000 (2000: £6,347,000) divided by the weighted average number of ordinary shares in issue of 46,740,477 (2000:46,508,772). 5. The financial information set out above does not constitute full statutory accounts within the meaning of Section 240 of the Companies Act 1985. The amounts shown in respect of the year ended 31 March 2001 have been extracted from the full statutory accounts, on which the auditors have made an unqualified report. The statutory accounts have been filed with the Registrar of Companies. 6. Copies of the interim financial statements will be posted to shareholders and are available to members of the general public from the company's registered office: Unit P14 Parklands, Heywood Distribution Park, Heywood, Lancs OL10 2TT.

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