Last updated at 10:00 AM on 09th September 2009
Sports Direct, controlled by Newcastle United owner Mike Ashley, has raised its annual earnings forecast after enjoying a jump in sales during the summer.
The chain, which trades as Sports World, Gilesports and Field & Trek, expects to achieve underlying earnings of at least £150million, ahead of City forecasts for a figure in the region of £147million.
Sales at the retailer rose 10 per cent in the 13 weeks to July 26 to £375million while gross profit was up 5 per cent at £157million over the same period.
Newcastle United owner Mike Ashley
Reason to smile: Mike Ashley's Sports Direct saw sales rise 10%
Since the end of July, Sports Direct said trading continued to be ahead of last year. The company has more than 350 stores in the UK and also owns sports brands including Karrimor, Slazenger and Dunlop.
Matthew McEachran, an analyst at Singer Capital Markets, said earnings forecasts for next year were likely to increase by 4 per cent in the wake of today's trading update, and as confidence and proximity to the 2010 World Cup increase.
He added: 'We believe this performance has been largely driven by improvements within the UK retail division, where the back-to-basics strategy and a combination of seasonal conditions, weak competition and promotions, have contributed towards the uplifts.'
Singer also noted the business had moved a step closer to the earnings target of £165million which would trigger a full pay-out under a new staff incentive scheme.
Sports Direct shares opened more than 3 per cent higher at 120.3p today.
Source