JD Sports sees profit at upper end of market view on overseas demand

FILE PHOTO: People pass a JD Sports store in London, Britain April 11, 2017. REUTERS/Neil Hall/File Photo

(Reuters) - Britain's JD Sports JD.L said on Friday it expected annual profit towards the upper end of the current market view on stronger demand for its gym clothing and premium-branded fashion overseas, defying the gloomy UK retail sector once again.

The company’s shares were seen rising as much as 5%, according to traders.

JD, the country's biggest sportswear retailer, has successfully targeted younger consumers with athleisure products as sports clothing becomes more acceptable. It sells premium ranges from the likes of Nike NKE.N and Adidas ADSGn.DE, and often uses exclusive products to set itself apart from rivals.

The owner of Footpatrol and Cloggs expects annual headline pretax profit to be in the upper quartile of 403 million pounds ($527.16 million) and 433 million pounds after adjusting for the impact of transitioning to IFRS 16.

“Against a backdrop of widely reported retail challenges in the Group’s core UK market, it is encouraging to report positive like-for-like trends in the Group’s global Sports Fashion fascias, particularly overseas,” the company said.

Founded in 1981 with a single store in the North West of England, the firm now has more than 2,400 stores across Europe, Asia Pacific and the United States.

The upbeat outlook comes against the backdrop of a struggling UK retail sector, caused by weakening consumer spending as Brexit looms, higher costs and more people shopping online.

British fashion brand Superdry SDRY.L warned on its full-year profit on Friday after Christmas sales fell short of its expectations.

JD also said its key overseas markets have different post-Christmas sale timings and the ultimate outrun will be reflected in these markets through the rest of January.

Reporting by Tanishaa Nadkar in Bengaluru; editing by Uttaresh.V