Sports Direct profits sink on weak pound and expansion – Telegraph.co.uk

Sales are expected to have risen from £2.8bn to £3.2bn on the back of new store openings. Trading has been overshadowed by a whirlwind of negative publicity following last year’s investigation into its treatment of workers.

A string of board resignations, unusual stake purchases and most recently a court battle with a former close ­adviser over an alleged £15m pub bet have wrecked the retailer’s reputation.

For the last 12 months, Sports ­Direct’s shares have been trading at levels not seen since the dark days that followed its disastrous stock market float in 2007.

Jonathan Pritchard, a Peel Hunt analyst, said that he expects gross margins to be “down a mile, mostly a function of the costly currency”. The chain has ­already warned that it expects to take a £35m earnings hit as a result of the weaker pound.

Mr Ashley took the reins of Sports Direct last year after the resignation of Dave Forsey, the chief executive, days after a damning report into the firm’s Shirebrook warehouse, where MPs said conditions were like a Victorian workhouse.

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