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JD Sports Fashion (JD.)

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Tuesday 23 September, 2008

JD Sports Fashion

Interim Results

RNS Number : 0302E
JD Sports Fashion Plc
23 September 2008
 





23 September 2008                           


                 JD SPORTS FASHION PLC

INTERIM RESULTS

FOR THE TWENTY SIX WEEKS TO 02 AUGUST 2008


JD Sports Fashion Plc (the 'Group'), the leading retailer of sport and athletic inspired fashion apparel and footwear, today announces its Interim Results for the 26 weeks ended 02 August 2008 (comparative figures are shown for the 26 week period ended 28 July 2007):



HIGHLIGHTS



H1 2008

£000


H1 2007

£000



% Change


Revenue


298,952



250,495



+19%


Gross profit %


48.2%



48.0%





Operating profit (before net financing costs, exceptional items and share of results of joint venture)



13,040




8,459




+54%


Profit before tax and exceptional items


12,403



8,074



+54%


Exceptional items


(3,287)



(2,746)





Profit before tax


9,116



5,328



+71%


Basic earnings per ordinary share


12.45p



7.29p



+71%


Adjusted basic earnings per ordinary share (see note 6)


15.50p



8.63p



+80%


Interim dividend payable per ordinary share


3.10p



2.50p



+24%


Net cash at end of period (see note 8)


3,455



7,122





  • Total Group revenue increased by 19% in the period and by 6.0% on a like for like basis (5.9% Sports Fascias; 6.7% Fashion Fascias). 


  • Gross margin improved from 48.0% to 48.2%, reflecting continued efforts to improve bought in margin as well as increasing own brand share in the Sports Fascias.


  • Group profit before tax and exceptional items increased by 54% to £12.4 million (2007: £8.1 million).


  • Total Group like for like sales cumulatively to 13 September 2008 now up 5.8% (5.4% Sports Fascias; 8.2% Fashion Fascias).


  Peter Cowgill, Executive Chairman, said: 


'We are delighted with the performance of the Group during the period. Trading has been very positive with improved like for like sales and gross margin generating a significant increase in profit before tax and exceptional items. We continue to invest in our store portfolio, systems and training to provide a solid platform for future growth.


'The like for like sales performance in the balance of the year will be measured against very strong comparatives from last year and with the backdrop of challenging conditions for the consumer. Nevertheless, the Board believes that the Group is strongly positioned to deliver on market expectations.'



Enquiries:


JD Sports Fashion Plc                                           Tel: 0161 767 1000

Peter Cowgill, Executive Chairman

Barry Bown, Chief Executive

Brian Small, Finance Director


Hogarth Partnership Limited                                 Tel: 020 7357 9477
Andrew Jaques
Barnaby Fry
Ian Payne




  EXECUTIVE CHAIRMAN'S STATEMENT


INTRODUCTION


The 26 week period to 02 August 2008 was one of like for like sales improvement in all our Fascias which has continued in the ensuing period to date. This has driven a further significant enhancement in Group performance to date though we continue to be cautious about the outlook for the balance of this year and for 2009. The continued strong performance has enabled us to continue with our substantial store refurbishment programme and to open ten new stores. The results of the Fashion Fascias are improving and we expect operating profitability to be achieved in the current year.


Our continued progress has resulted in a 54% improvement in profit before tax and exceptional items to £12.4 million (2007: £8.1 million). 


Profit before tax in the period was £9.1 million (2007: £5.3 million) after a net exceptional charge of £3.3 million (2007: £2.8 million). The exceptional charge relates to the write off of the remaining goodwill from the acquisition of the Hargreaves airports stores portfolio together with property portfolio rationalisation costs. 


Profit for the period after taxation was £6.1 million (2007: £3.5 million).



SPORTS FASCIAS


The Sports Fascias have again traded very positively on a consistent basis and we are continuing to see the benefits of rationalising and refurbishing the store portfolio. In the first half of this year we completed 20 store refurbishments (including Dublin, Bluewater and Gateshead MetroCentre) at a cost of £7.3 million and by the year end this number will have increased to about 37 at an estimated cost of £12.2 million. We expect this programme will continue next year and until we have achieved a consistent quality, look and feel for all of our stores. We opened nine new stores in the half year and expect several more to be added by year end. Consequently, gross capital investment will considerably exceed the depreciation charge in the current year.


We are continuing to develop a more sophisticated approach to merchandise planning and systems and believe that the investment in people and training has been very worthwhile. In addition to this, a greater emphasis on footfall monitoring and conversion statistics is helping both to develop our staff and produce sales improvement, though our success continues to have at its core a differentiated and fashionable branded and own brand offer.



FASHION FASCIAS


We are pleased with progress in both of the Fashion Fascias, Bank and Scotts. The success of the store rationalisation programme last year combined with a more focussed offer has led to the anticipated improvement in Scotts results.


Bank had a slower start to the year than Scotts but substantial work has been carried out to ensure that an aggressive approach was adopted to managing terminal stock out of the business. This has resulted in a short term reduction in margin but nevertheless first half results were in line with expectations and recent trading has been much stronger than in the equivalent period last year. Our objective with this Fascia has always been to create a successful model before rolling it out more extensively.


The move of Scotts' and Bank's management teams to our head office in Bury was successfully completed earlier in the year.



  GROUP PERFORMANCE


Revenue, gross margin and overheads


Total Group revenue increased by 19% in the period to £299.0 million (2007: £250.5 million) and by 6.0% on a like for like basis.


Revenue increased by 5.9% on a like for like basis in the Sports Fascias. The Fashion Fascias like for like sales performance was up 6.7% cumulatively in the half year period.

 

Group gross margin increased in the period from 48.0% to 48.2% reflecting continuing efforts to improve bought in margin and increase own brand sales in the Sports Fascias.


Overhead ratios (excluding exceptional items), net of other operating income, improved to 43.8% of sales (2007: 44.6%), as a result of increased turnover and improving property cost ratios. However, there have been continued planned increases in marketing and merchandising overheads to achieve the improvement in results. We have also reclassified buying and design overheads so that they are now included within selling and distribution overheads.



Operating profits and results


Group operating profit (before net financing costs, exceptional items and share of results of joint venture) increased to £13.0 million (2007: £8.4 million). The Group operating profit margin (before net financing costs, exceptional items and share of results of joint venture) for the first half of the year has therefore increased from 3.4% to 4.4%.


Although exceptional items increased slightly to £3.3 million (2007: £2.8 million), Group operating profit after exceptional items but before share of results of joint ventures and net financing costs rose by £4.0 million to £9.7 million (2007: £5.7 million). 


The exceptional items comprise:                



£m



Impairment of goodwill    

2.0

Loss on disposal of non-current assets    

1.3



Total                

3.3


The impairment of goodwill relates to the write off of the remaining balance from the acquisition of the Hargreaves airports stores portfolio in June 2006. Although JD remains committed to airport retailing, the continuing increase in space allocated for security in airports has already resulted in the loss of a number of the acquired stores and there is no guarantee that the concession agreements for the remaining stores will be extended or even that they will not be terminated early. In such circumstances, we will continue to work with the airport operators to secure alternative accommodation, though it cannot always be found economically.


Group profit before tax in the period was £9.1 million (2007: £5.3 million). 


Debt reduction and working capital


Net cash at 02 August 2008 of £3.5 million was £3.6 million lower than the position at 28 July 2007 (£7.1m). However, the net cash balance has been achieved after expenditure on acquisitions, investments and associated asset purchases since 28 July 2007 of £32.6 million.


Excluding the impact from the acquisitions, inventories have increased slightly to £59.0 million at 02 August 2008 from £56.2 million at 28 July 2007. Trade creditors continue to be paid to terms to maximise settlement discounts.



STORE PORTFOLIO


Group store numbers reduced in the period from 432 to 430 although the total retail square footage increased from 1,280,000 sq ft to 1,290,000 sq ft. The split between the Sport and Fashion Fascias is as follows:


Sport 



 No. of

stores

Retail ('000 sq ft)




At 02 February 2008 

345

1,089

New stores

9

37

Closures

(9)

(27)




At 02 August 2008 

345

1,099



Fashion



No. of

stores

Retail ('000 sq ft)




At 02 February 2008 

87

191

New stores

1

3

Closures

(3)

(3)




At 02 August 2008 

85

191



DIVIDENDS AND EARNINGS PER ORDINARY SHARE


The Board has decided to pay an interim dividend of 3.10p per ordinary share, which represents an increase of 24% over the prior year (2007: 2.50p). The Board's current intention is that the level of increase in the final dividend will be lower than this so as to restore the historic one-third / two-thirds split between the interim and final dividends. Whilst the Board intends to continue with a progressive dividend policy, it also wishes to retain funding flexibility in the business to continue to allow it to make strategic acquisitions and capital investments as such opportunities arise.


The dividend will be paid on 09 January 2009 to shareholders on the register as at close of business on 05 December 2008. A scrip dividend alternative will be offered to all shareholders. 


The adjusted basic earnings per ordinary share before exceptional items are 15.50p (2007: 8.63p).


The basic earnings per ordinary share are 12.45p (2007: 7.29p).

  


CURRENT TRADING AND OUTLOOK


Trading in the six weeks since the period end has continued to be encouraging with like for like sales for the full 32 week period to 13 September up by 5.4% in the Sports Fascias and by 8.2% in the Fashion Fascias. The like for like sales performance in the balance of the year will be measured against very strong comparatives from last year and with the backdrop of challenging conditions for the consumer. Nevertheless, the Board believes that the Group is strongly positioned to deliver on market expectations.



  EMPLOYEES


Another period of progress in challenging times again could not have been achieved without the considerable commitment of all our staff and management. The Board extends its thanks to all involved.



Peter Cowgill

Executive Chairman 

23 September 2008



  CONSOLIDATED INCOME STATEMENT

for the 26 weeks ended 02 August 2008






Note

Unaudited

26 weeks to 02 August 

2008

£000

Unaudited

26 weeks to 

28 July 

2007

£000

Restated (1)


53 weeks to 

02 February 2008 

£000

Restated (1) 


revenue


2


298,952


250,495


592,240

Cost of sales


(154,931)

(130,179)

(300,813)






gross profit


144,021

120,316

291,427


Selling and distribution expenses - normal



(122,600)


(104,915)


(225,994)

Selling and distribution expenses - exceptional

3

(1,242)

(2,746)

(8,404)

Selling and distribution expenses


(123,842)

(107,661)

(234,398)


Administrative expenses - normal



(8,915)


(7,420)


(22,500)

Administrative expenses - exceptional

3

(2,045)

-

-

Administrative expenses 


(10,960)

(7,420)

(22,500)


Other operating income



534


478


1,086






operating profit


9,753

5,713

35,615






Before exceptional items


13,040

8,459

44,019

Exceptional items

3

(3,287)

(2,746)

(8,404)






operating profit


9,753

5,713

35,615

Share of results of joint venture


(245)

-

(145)

Financial income


227

118

297

Financial expenses


(619)

(503)

(764)






profit before tax


9,116

5,328

35,003

Income tax expense

4

(3,008)

(1,812)

(11,416)






profit for the period


6,108

3,516

23,587






Attributable to equity holders of the parent


6,010

3,516

23,549

Attributable to minority interest


98

-

38






Basic and diluted earnings per ordinary share

6

12.45p

7.29p

48.79p


  • The Consolidated Income Statements for the periods ended 28 July 2007 and 02 February 2008 have been restated to reclassify certain costs from administrative to selling and distribution expenses.


GROUP STATEMENT OF RECOGNISED INCOME AND EXPENSE

for the 26 weeks ended 02 August 2008


The Group has no recognised gains or losses during the current or previous period other than the results reported above. 

  CONSOLIDATED BALANCE SHEET

as at 02 August 2008






Note

Unaudited

As at

02 August

2008

£000


Unaudited

As at  

28 July

 2007

£000



As at  

02 February 

2008

£000

assets







Intangible assets


43,933


20,562


41,371

Property, plant and equipment


59,308


43,294


53,622

Other receivables


5,091


2,710


5,025

Investment property


4,126


-


4,151

Equity accounted investment in joint venture


115


-


360

total non-current assets


112,573


66,566


104,529








Inventories


66,994


56,169


58,669

Trade and other receivables


19,573


13,986


15,899

Cash and cash equivalents

8

3,640


7,374


11,969

total current assets


90,207


77,529


86,537








total assets


202,780


144,095


191,066








liabilities







Interest-bearing loans and borrowings


(102)


(85)


(134)

Trade and other payables


(89,920)


(63,871)


(80,389)

Provisions


(1,898)


(1,590)


(1,893)

Income tax liabilities


(4,965)


(1,884)


(9,147)

total current liabilities


(96,885)


(67,430)


(91,563)








Interest-bearing loans and borrowings


(83)


(167)


(83)

Other payables


(13,384)


(8,454)


(11,839)

Provisions


(3,944)


(3,487)


(4,726)

Deferred tax liabilities


(2,588)


(1,756)


(46)

total non-current liabilities


(19,999)


(13,864)


(16,694)








total liabilities


(116,884)


(81,294)


(108,257)


total assets less total liabilities



85,896



62,801



82,809








capital and reserves







Issued ordinary share capital

9

2,413


2,413


2,413

Share premium

9

10,823


10,823


10,823

Retained earnings

9

72,660


49,565


69,573


total equity



85,896



62,801



82,809








Attributable to equity holders of the parent


84,741


62,801


81,627

Attributable to minority interest


1,155


-


1,182



CONSOLIDATED CASH FLOW STATEMENT

for the 26 weeks ended 02 August 2008






Note

Unaudited

26 weeks to  

02 August 

2008

£000


Unaudited

26 weeks to  

28 July 

2007

£000



53 weeks to  

02 February 2008

£000

cash flows from operating activities








Profit for the period



6,108


3,516


23,587

Share of results of joint venture



245


-


145

Income tax expense


4

3,008


1,812


11,416

Financial expenses



619


503


764

Financial income



(227)


(118)


(297)

Depreciation and amortisation of 

non-current assets




6,441



5,348



12,421

Impairment of non-current assets



2,045


908


2,535

Loss on disposal of non-current assets


3

1,242


1,892


3,015

(Increase)/decrease in inventories



(8,764)


(4,700)


2,955

(Increase)/decrease in trade and 

other receivables




(2,717)



(974)



1,396

Increase in trade and other

payables and provisions




7,637



1,141



6,877

Interest paid



(619)


(503)


(764)

Income taxes paid



(8,088)


(3,220)


(7,619)


net cash from operating activities




6,930



5,605



56,431









cash flows from investing activities








Interest received



144


118


297

Proceeds from sale of non-current assets



5


1,231


1,257

Disposal costs of non-current assets



(636)


(1,695)


(2,432)

Acquisition of intangible assets



-


-


(4,279)

Acquisition of property, plant and equipment



(13,257)


(8,834)


(19,407)

Acquisition of investment property



-


-


(4,160)

Acquisition of non- current other receivables



(194)


(235)


(389)

Cash consideration of acquisitions net of 

cash acquired




(1,289)



-



(1,135)

Investment in joint venture



-


-


(505)

Amounts loaned to joint venture



-


-


(2,479)


net cash used in investing activities




(15,227)



(9,415)



(33,232)









cash flows from financing activities








Repayment of interest-bearing loans 

and borrowings




-



(37)



(18,917)

Payment of finance lease and similar hire 

purchase contracts




(32)



(9)



(19)

Dividends paid



-


-


(3,524)


net cash used in financing activities




(32)



(46)



(22,460)


net (decrease)/increase in cash and 

cash equivalents




8



(8,329)




(3,856)




739



1.    BASIS OF PREPARATION


JD Sports Fashion Plc (formerly The John David Group Plc) (the 'Company') is a company incorporated and domiciled in the United Kingdom. The consolidated half-year financial report for the period ended 02 August 2008 represents that of the Company and its subsidiaries (together referred to as the 'Group').


This half-year financial report is an interim management report as required by DTR 4.2.3 of the Disclosure and Transparency Rules of the UK's Financial Services Authority and was authorised for issue by the Board of Directors on 23 September 2008.


As required by the Disclosure and Transparency Rules of the UK's Financial Services Authority, the half-year financial report has been prepared by applying the accounting policies and presentation that were applied in the preparation of the Company's published consolidated financial statements for the financial year ended 02 February 2008, which were prepared in accordance with International Financial Reporting Standards as adopted by the EU. 


The half-year financial report is prepared in accordance with the EU endorsed standard IAS 34 'Interim Financial Reporting'. The comparative figures for the financial year ended 02 February 2008 are not the Group's statutory accounts for that financial year. Those accounts have been reported on by the Group's Auditor and delivered to the Registrar of Companies. The Report of the Auditor was (i) unqualified, (ii) did not include a reference to any matters to which the Auditor drew attention by way of emphasis without qualifying their report, and (iii) did not contain a statement under section 237(2) or (3) of the Companies Act 1985.


The information contained in the half-year financial report for the 26-week periods ended 02 August 2008 and 28 July 2007 is unaudited.


PRIOR PERIOD RESTATEMENT

The comparatives shown in the Consolidated Income Statement for the periods ended 28 July 2007 and 02 February 2008 have been restated to reclassify certain costs from administrative to selling and distribution expenses. Management consider that the revised presentation is a better reflection of the nature of these costs.


  

2.    SEGMENTAL ANALYSIS


The Group manages its business activities through two divisions - Sport and Fashion. Revenue and costs are readily identifiable for each segment.

 

The divisional results for the 26 weeks to 02 August 2008 are as follows:





Unaudited

Sport

£000


Unaudited

Fashion

£000


Unaudited

Total

£000








Revenue


258,352


40,600


298,952


Operating profit/(loss) before financing and exceptional items




16,484




(3,444)




13,040

Exceptional items


(2,993)


(294)


(3,287)


Operating profit/(loss)



13,491



(3,738)



9,753

Share of results of joint venture






(245)

Financial income






227

Financial expenses






(619)


Profit before tax







9,116

Income tax expense






(3,008)


Profit for the period







6,108


The Board consider that share of results of joint venture and net funding costs are cross divisional in nature and cannot be allocated between the divisions on a meaningful basis.


The comparative divisional results for the 26 weeks to 28 July 2007 are as follows:

 




Unaudited

Sport

£000


Unaudited

Fashion

£000


Unaudited

Total

£000








Revenue


236,172


14,323


250,495


Operating profit/(loss) before financing and exceptional items




10,638




(2,179)




8,459

Exceptional items


(3,512)


766


(2,746)


Operating profit/(loss)



7,126



(1,413)



5,713

Financial income






118

Financial expenses






(503)


Profit before tax







5,328

Income tax expense






(1,812)


Profit for the period









3,516


The Board consider that net funding costs are cross divisional in nature and cannot be allocated between the divisions on a meaningful basis.



3.    EXCEPTIONAL ITEMS




Unaudited

26 weeks to  

02 August 

2008

£000


Unaudited

26 weeks to  

28 July 

2007

£000



53 weeks to  

02 February 2008

£000








Loss on disposal of non-current assets


1,242


1,892


3,015

Provision for rentals on onerous property leases


-


(1,092)


-

Impairment of property, plant and equipment


-


908


2,535

Lease variation costs (i)


-


1,038


2,854


Selling and distribution expenses - exceptional



1,242



2,746



8,404









Impairment of acquisition goodwill



2,045



-



-


Administrative expenses - exceptional



2,045



-



-





3,287



2,746



8,404


  • Lease variation costs represent the cost of varying an onerous lease to create a break option.



4.    INCOME TAX EXPENSE




Unaudited

26 weeks to 

02 August 

2008

£000


Unaudited

26 weeks to  

28 July 

2007

£000



53 weeks to  

02 February 2008

£000


Current tax







UK corporation tax at 28.3% (2007: 30%)


3,388


1,627


13,229

Adjustment relating to prior periods


-


-


(251)


Total current tax charge



3,388



1,627



12,978


Deferred tax







Deferred tax (origination and reversal of temporary differences)



(380)



185



(544)

Adjustments relating to prior periods


-


-


(1,018)


Total deferred tax (credit)/charge



(380)



185



(1,562)


Income tax expense



3,008



1,812



11,416


  

5.    DIVIDENDS


After the balance sheet date the following dividends were proposed by the Directors. The dividends were not provided for at the balance sheet date.




Unaudited

26 weeks to  

02 August 

2008

£000


Unaudited

26 weeks to  

28 July 

2007

£000



53 weeks to  

02 February 2008

£000








3.10p per ordinary share (28 July 2007: 2.50p,

02 February 2008: 6.00p)



1,496



1,207



2,896



DIVIDENDS ON ISSUED ORDINARY SHARE CAPITAL




Unaudited

26 weeks to  

02 August 

2008

£000


Unaudited

26 weeks to  

28 July 

2007

£000



53 weeks to  

02 February 2008

£000








Final dividend of 6.00p (2007: 4.80p) per qualifying ordinary share approved in respect of prior period, but not recognised as a liability in that period



2,896



2,317



2,317








Interim dividend of 2.50p per qualifying ordinary share paid in respect of 53 week period ended 02 February 2008



-



-



1,207










2,896


2,317


3,524


  

6.    EARNINGS PER ORDINARY SHARE


BASIC AND DILUTED EARNINGS PER ORDINARY SHARE


The calculation of basic and diluted earnings per ordinary share for the 26 weeks to 02 August 2008 is based on the profit for the period attributable to equity holders of the parent of £6,010,000 (26 weeks to 28 July 2007: £3,516,000; 53 weeks to 02 February 2008: £23,549,000) and a weighted average number of ordinary shares outstanding during the 26 weeks ended 02 August 2008 of 48,263,434 which is unchanged from the relevant prior periods, calculated as follows:




Unaudited

26 weeks to  

02 August 

2008


Unaudited

26 weeks to  

28 July 

2007



53 weeks to  

02 February 2008








Issued ordinary shares at beginning of period


48,263,434


48,263,434


48,263,434

Weighted average number of ordinary shares during the period - basic and diluted



48,263,434



48,263,434



48,263,434



ADJUSTED BASIC AND DILUTED EARNINGS PER ORDINARY SHARE


Adjusted basic and diluted earnings per ordinary share has been based on the profit for the period attributable to equity holders of the parent for each financial period but excluding the post tax effect of certain exceptional items. The Directors consider that this gives a more meaningful measure of the underlying performance of the Group.




Unaudited

26 weeks to  

02 August 

2008

£000


Unaudited

26 weeks to  

28 July 

2007

£000



53 weeks to  

02 February 2008

£000








Profit for the period attributable to equity holders of the parent



6,010



3,516



23,549

Exceptional items excluding loss on disposal of non-current assets



2,045



854



5,389

Tax relating to relevant exceptional items


(573)


(207)


(1,405)

Profit for the period attributable to equity holders of the parent excluding 

exceptional items




7,482




4,163




27,533


Adjusted basic and diluted earnings per ordinary share




15.50p




8.63p




57.05p


  

7.    ACQUISTIONS


ACQUISITION OF BANK STORES HOLDINGS LIMITED


On 07 December 2007, the Group acquired the entire share capital of Bank Stores Holdings Limited for a cash consideration of £1 together with associated fees of £135,015. Bank is a retailer of branded mens and womens fashion footwear, apparel and accessories with 49 retail outlets across the UK.


During the 26 week period ended 02 August 2008, certain hindsight adjustments have been made to the provisional fair values of the net assets of Bank Stores Holdings Limited as at the acquisition date, in accordance with IFRS3 'Business Combinations'.  


The revised calculation of goodwill is summarised below:






UNAUDITED

Provisional fair value at

 02 February 2008 

£000



 Fair value

adjustments

£000

 Provisional

 fair value at

02 August

 2008

£000

Acquiree's net liabilities at the acquisition date:




Intangible assets

5,481

-

5,481 

Property, plant & equipment

8,427

-

8,427

Inventories

8,151

(246)

7,905

Cash and cash equivalents

-

-

-

Trade and other receivables

3,169

-

3,169

Interest bearing loans and borrowings

(18,796)

-

(18,796)

Trade and other payables

(15,913)

-

(15,913)

Provisions

(1,117)

-

(1,117)

Income tax liabilities

(376)

(629)

(1,005)

Deferred tax liabilities

-

(2,919)

(2,919)





Net identifiable liabilities

(10,974)

(3,794)

(14,768)





Goodwill on acquisition

11,109

3,794

14,903





Consideration paid - satisfied in cash

135

-

135



ACQUISITION OF NICHOLAS DEAKINS LIMITED


On 11 April 2008, the Group acquired 100% of the entire issued share capital of Nicholas Deakins Limited for a cash consideration of £1,337,000 together with associated fees of £33,000. Nicholas Deakins Limited is involved in the design, sourcing and wholesale of own-label fashion footwear and apparel. Goodwill has been calculated at an amount of £864,000 based on a preliminary assessment of the provisional fair value of the net assets as at the acquisition date.

  

8.    ANALYSIS OF NET DEBT




UNAUDITED


At 02 February 

2008

£000



Cashflow

£000


At 02 August 2008

£000








Bank balances and cash floats


11,969


(8,329)


3,640


Cash and cash equivalents



11,969



(8,329)



3,640








Interest-bearing loans and borrowings:







Loan notes


(166)


-


(166)

Finance leases and similar hire

purchase contracts



(51)



32



(19)












11,752



(8,297)



3,455



9.    CAPITAL AND RESERVES


RECONCILIATION OF MOVEMENT IN CAPITAL AND RESERVES




UNAUDITED


Ordinary

Share Capital

£000


Share

Premium

£000


Retained

Earnings

£000


Minority Interest 

£000


Total

Equity

£000












Balance at 02 February 2008


2,413


10,823


68,391


1,182


82,809

Minority interest on acquisition


-


-


-


(125)


(125)

Total recognised income and expense



-



-



6,010



98



6,108

Dividends to shareholders (see note 5)



-



-



(2,896)



-


  (2,896)


Balance at 02 August 2008



2,413



10,823



71,505



1,155



85,896





UNAUDITED


Ordinary

Share Capital

£000



Share

Premium

£000



Retained

Earnings

£000



Total

Equity

£000










Balance at 27 January 2007


2,413


10,823


48,366


61,602

Total recognised income and expense


-


-


3,516


3,516

Dividends to shareholders (see note 5)


-


-


(2,317)


  (2,317)


Balance at 28 July 2007



2,413



10,823



49,565



62,801


  

10.    RELATED PARTY TRANSACTIONS AND BALANCES


RELATED PARTY - PENTLAND GROUP PLC


Pentland Group Plc owns 57% of the issued ordinary share capital of JD Sports Fashion Plc.






UNAUDITED

Value of transactions

26 weeks to

02 August 2008

£000


Receivable / (Payable) at

02 August 2008

£000


Value of transactions

26 weeks to

28 July 2007

£000


Receivable / (Payable) at

28 July 2007

£000







Concession fee income

-

-


(147)

-

Purchase of inventory for retail

(12,604)

(3,323)


(13,005)

(2,857)

Other income

-

-


44

-







Payments (gross including VAT)

(12,780)

-


(14,400)

-

Receipts (gross including VAT)

-

-


52

-



RELATED PARTY - FOCUS BRANDS LIMITED


The Company owns 49% of the issued ordinary share capital of Focus Brands Limited.






UNAUDITED

Value of transactions

26 weeks to

02 August 2008

£000


Receivable / (Payable) at

02 August 2008

£000


Value of transactions

26 weeks to

28 July 2007

£000


Receivable / (Payable) at

28 July 2007

£000







Purchase of inventory for retail

(2,990)

(652)


-

-

Rental income

158

-


-

-

Interest income

83

-


-

-







Payments (gross including VAT)

(2,825)

-


-

-







Loan notes receivable

-

2,563


-

-



11.    HALF-YEAR REPORT


The half-year report will be posted to all shareholders in mid October. Additional copies are available on application to the Company Secretary, JD Sports Fashion Plc, Hollinsbrook Way, Pilsworth, Bury, LancashireBL9 8RR, or can be downloaded from our website: www.jdplc.com.


  

RESPONSIBILITY STATEMENT


We confirm that to the best of our knowledge:


  • The condensed set of financial statements has been prepared in accordance with IAS 34 'Interim Financial Reporting' as adopted by the EU;

  • The interim management report includes a fair review of the information required by:

  • DTR 4.2.7R of the Disclosure and Transparency Rules, being an indication of important events during the first six months of the financial year and their impact on the condensed set of financial statements; and a description of principal risks and uncertainties for the remaining six months of the year; and

  • DTR 4.2.8R of the Disclosure and Transparency Rules, being related party transactions that have taken place in the first six months of the current financial year and that have materially affected the financial position or performance of the entity during that period; and any changes in the related party transactions described in the last annual report that could do so.


By order of the Board




Brian Small                                    

Secretary

23 September 2008


  INDEPENDENT REVIEW REPORT TO JD SPORTS FASHION PLC


INTRODUCTION


We have been engaged by the Company to review the condensed set of financial statements in the half-yearly financial report for the 26 week period ended 02 August 2008 which comprises the Consolidated Income Statement, Consolidated Balance Sheet, Consolidated Cash Flow Statement and the related explanatory notes. We have read the other information contained in the half-yearly financial report and considered whether it contains any apparent misstatements or material inconsistencies with the information in the condensed set of financial statements.


This report is made solely to the Company in accordance with the terms of our engagement to assist the Company in meeting the requirements of the Disclosure and Transparency Rules ('the DTR') of the UK's Financial Services Authority ('the UK FSA'). Our review has been undertaken so that we might state to the Company those matters we are required to state to it in this report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Company for our review work, for this report, or for the conclusions we have reached.


DIRECTORS' RESPONSIBILITIES


The half-yearly financial report is the responsibility of, and has been approved by, the Directors. The Directors are responsible for preparing the half-yearly financial report in accordance with the DTR of the UK FSA.


As disclosed in note 1, the annual financial statements of the Group are prepared in accordance with IFRSs as adopted by the EU. The condensed set of financial statements included in this half-yearly financial report has been prepared in accordance with IAS 34 'Interim Financial Reporting' as adopted by the EU.


OUR RESPONSIBILITY


Our responsibility is to express to the Company a conclusion on the condensed set of financial statements in the half-yearly financial report based on our review. 


SCOPE OF REVIEW


We conducted our review in accordance with International Standard on Review Engagements (UK and Ireland) 2410 'Review of Interim Financial Information Performed by the Independent Auditor of the Entity' issued by the Auditing Practices Board for use in the UK. A review of interim financial information consists of making enquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing (UK and Ireland) and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.


CONCLUSION


Based on our review, nothing has come to our attention that causes us to believe that the condensed set of financial statements in the half-yearly financial report for the 26-week period ended 02 August 2008 is not prepared, in all material respects, in accordance with IAS 34 as adopted by the EU and the DTR of the UK FSA.


KPMG Audit Plc
Chartered Accountants

Preston
23 September 2008

                             


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