Sports Direct staff cash in as firm posts big profit rise
LONDON, July 18 (Reuters) - Britain's biggest sporting goods retailer Sports Direct is to hand shares worth almost 130 million pounds ($197 million) in total to 2,000 of its staff, after unveiling another strong rise in annual profit.
Sports Direct has grown rapidly in recent years to dominate the sports market on Britain's high street, benefiting from the demise of rivals like JJB Sports during the economic downturn, a growing internet presence, expansion in the UK and Europe, and staff motivated by a lucrative bonus scheme.
The company, controlled by billionaire Newcastle United soccer club owner Mike Ashley, on Thursday said underlying pretax profit was 208.1 million pounds ($316 million) in the 52 weeks to April 28, up 40 percent on a year ago.
The group, which owns Sports World and Lillywhites stores as well as brands like Slazenger and Dunlop, said it would in August award shares to some 2,000 of its 24,000 staff, including full-time shop assistants, after the firm hit financial targets.
Under the bonus scheme started in 2009, the average employee earning 20,000 pounds who has been with the firm at least five years will receive 12,000 Sports Direct shares worth around 72,000 pounds at the current share price. The company said staff were on track for another payout in 2015 through a second scheme.
First quarter trading had started ahead of management expectations, the firm said, adding that it had decided not to put a shares payout proposal for its owner Ashley to shareholders at its upcoming AGM, and would instead review its various options for remunerating him.
The proposal would have seen Ashley handed 10 million shares to vest in 2018 if performance targets were met.
Shares in Sports Direct closed at 600.5 pence on Wednesday, up 47 percent on six months ago, valuing the firm at around 3.6 billion pounds.