Investing.com — Shares of JD (NASDAQ:) Sports Fashion (LON:) jumped on Thursday today following the company’s second-quarter trading update, which posted strong sales growth across its global operations.
At 4:40 am (0840 GMT), JD Sports was trading 5% higher at £134.60.
JD Sports reported an 8.3% organic sales growth and a 2.4% like-for-like (LFL) sales increase for the 13 weeks ending on August 3.
“JD Sports delivered a LFL growth of +2.4% in Q2. The range of sell-side expectations ahead of the results was very wide, but based on our conversations buy-side expected ~3% LFL sales growth,” said analysts from UBS Global Research in a note.
“In particular, we saw double-digit organic sales growth in North America and Europe, supported by the continued success of our JD store rollout programme,” said JD Sports Fashion chief executive Régis Schultz in a statement.
“Based on our first-half trading, we remain on track to deliver profit within our full-year guidance,” he added.
The Group’s performance varied across regions, with North America leading the way. LFL sales in North America grew by 5.7%, while organic growth reached 13.7%. Europe also delivered strong results, with LFL sales up 3.0%.
The UK, despite a challenging market environment, showed significant quarter-on-quarter improvement.
All three main segments of JD Sports—JD, Complementary Concepts, and Sporting Goods & Outdoor—reported LFL growth. The JD segment was a standout performer, benefiting from new store openings and delivering 11% organic growth.
JD Sports’ acquisition of Hibbett, Inc., completed on 25 July 2024, just before the period end, is set to further boosted the company’s presence in the U.S. market. Hibbett, with its 1,179 stores, adds considerable scale and strengthens JD Sports’ brand relationships in the world’s largest sportswear market.
The company also continued its global expansion during the first half of the year, opening 85 new JD stores. This, combined with the Hibbett acquisition and the ongoing disposal of non-core stores, brought the total number of stores to 4,506 by the end of the first half, an increase of 1,189 from the beginning of the year.
Despite the strong Q2 performance, JD Sports remains cautious about the outlook for the rest of the year, citing the ongoing volatility in the global macroeconomic environment.
“The global macro environment remains volatile and so we continue to be cautious on our outlook for the rest of the year,” said analysts at UBS.
However, the company reiterated its full-year profit guidance range of £955m to £1,035m, on a pre-Hibbett basis, despite an anticipated £15m headwind due to a stronger pound.