JD Sports Fashion, the UK sportswear giant, has warned that the war in the Middle East could drive up prices after closing 24 stores in the UK over the past year. The company, which operates 4,811 stores worldwide, reported a drop in annual earnings as it pressed ahead with its 'fewer, bigger, better' strategy.
Store closures and strategy
JD Sports closed 24 UK stores on a net basis as part of its focus on larger, more profitable outlets. The retailer said it continues to prioritise quality over quantity, aiming to enhance the customer experience in its remaining stores.
Impact of Middle East conflict
While JD Sports stated it has no direct exposure to the Middle East and only a handful of franchised shops in the region, the company acknowledged that the ongoing war could eventually affect its business. In a statement, JD noted: 'Over time, the potential future impacts of heightened uncertainty may contribute to direct cost pressures, including energy and fuel costs across our store and logistics networks, respectively, as well as potential indirect impacts on pricing and consumer demand should input cost inflation emerge.'
Financial performance
JD Sports reported a pre-tax profit of £852 million for the year to the end of January 2026, down 6.4% compared with the previous year. The company now forecasts a pre-tax profit of between £750 million and £850 million for the next financial year, reflecting uncertainty caused by the conflict.
Total organic sales for the group increased by 2.1% year on year to £12.66 billion, excluding acquisitions. However, in the UK, organic sales declined by 2.5%, and like-for-like sales dropped by 3.9%, which the company attributed to a 'tough consumer backdrop'.
Trading conditions
Since the end of the financial year, JD said cold and wet weather had dampened sales. Trading in April was 'volatile', with a strong Easter performance followed by fewer visitors to shops.
CEO comment
Regis Schultz, JD's chief executive, said: 'We delivered a resilient performance, achieving organic sales growth of 2.1% despite tough market conditions. Our deep understanding of our customers and lifestyle trends give us a clear view of how they want to shop and spend, allowing us to consistently deliver the right products, in the right places and at the right prices.'
He added: 'Whilst we continue to expect muted market growth in FY27, we remain confident in JD Group's medium-term trajectory, underpinned by our strong brand partnerships and agile, multi-brand model.'
