Another Win for Multibagger Sports Direct

LONDON -- Sports Direct  (LSE: SPD.L  )  this morning released its pre-close trading update for the first half of its financial year and is still riding its own Olympics wave of high-street euphoria.

Gross profit rose 21.7% from H1 2011 to 167.4 million pounds. Total sales for Q2 increased by 18% to 402.7 million pounds, above the prior-year quarter's 341.3 million pounds and marginally down from Q1's 25% comparative rise in sales.

The year-on-year breakdown saw sports retail sales increase 16.8% to 344.7 million pounds, the brands division revenue increase 18.9% to 39.7 million pounds, and "premium lifestyle" sales increase 43% to 18.3 million pounds. The half-year's gross profit figures saw Sports Retail up 20.5% from the prior-year quarter to 142.8 million pounds, brands up 33.9% to 17 million pounds, and premium lifestyle up 18.8% to 7.6 million pounds.

Chief executive Dave Forsey commented: "The Group has continued to deliver strong growth through the second quarter, especially within the U.K. Sports Retail division where sales and margins benefited from the London Olympics and an excellent 'back to school' period. Since the end of September trading has remained equally strong and the Board is therefore confident of reaching the full year targeted "super stretch" underlying EBITDA of 270 million pounds (before the charge for the bonus share schemes)."

The positive update comes at the end of a month in which the company bought 20 shops from the administrators of JJB Sports. On Dec. 13, Sports Direct will announce its interim results for the 26 weeks ending Oct. 28.

The share price was largely unmoved by the news this morning, falling 1% to 399.8 pence at the time of writing from yesterday's close of 404 pence.

It's hard to believe that in 2008, Sports Direct's shares traded at a low of 32 pence. However, strong management and a firm strategy have seen them not only survive, but thrive in the recession, making them a 12-bagger from 2008's low price.

If you are keen to earn such handsome profits from shares, this free Motley Fool report -- "10 Steps To Making A Million In The Market" -- can help you on your way. The report explains how tracking down small, dynamic companies is a vital step on the path to the magic million-pound milestone. You never know -- the next Sports Direct could be out there right now, ready to transform your wealth.

Investing is by no means easy in today's uncertain economy. That's why we've published "Top Sectors for 2012" -- our guide to three favorable industries. This free report will be dispatched immediately to your inbox.

Further Motley Fool investment opportunities:

Sam does not own shares in any of the companies mentioned. The Motley Fool has a disclosure policy. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.


Read/Post Comments (0) | Recommend This Article (1)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 2072983, ~/Articles/ArticleHandler.aspx, 12/21/2014 5:13:47 AM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...


Advertisement