Sports Direct profits to slow as ‘media frenzy’ takes its toll – Telegraph.co.uk

The company was the first to warn that it would be hurt by Britain’s decision to leave the EU as it did not have currency hedging in place for 2017 to cushion a fall in sterling. Analysts believe that Sports Direct orders between £600m and £700m of stock from Asia and pays in dollars, which means that it will face significantly higher import costs as a result of the falling pound. 

Sales for this year will also be knocked by a slump in demand for replica football shirts after England crashed out of the Euros. Mr Ashley admitted to MPs last month that Sports Direct had paid workers at its warehouse below the minimum wage because of extensive search procedures.

However, he said that measures had already been taken to address the problem. Sports Direct has attempted to rescue BHS three times, but administrators turned down Mr Ashley’s approaches for being too low.  However, last week Mr Ashley took a step closer in his long running campaign with Findel, the online and catalogue retailer.

He has backing from Schroders and Toscafund to be made chairman of Findel and replace the outgoing chairman, David Sugden.  Sports Direct owns a 30pc stake in the company and has been pushing Findel’s Express Gifts subsidiary to channel Sports Direct’s portfolio of sports goods brands. However, Findel has said it will need to consult minority investors and Mr Ashley will need approval from the Financial Conduct Authority, which regulates Express Gifts. 

Mr Ashley has missed out on his hopes of buying Debenhams’ Irish business, and his hopes of an assault on the US market with a joint bid for US retail chain Sports Authority failed after it agreed a $15m (£11m) deal with Dick’s Sporting Goods.