JD Sports keeps its nerve on guidance despite a bruising half

JD Sports Fashion PLC ( LSE:JD. OTC:JDSPY ) has kept its full-year profit forecast intact, even after a rough six months in which earnings slid by a fifth. The FTSE 100 trainers-and-tracksuits giant still expects profit before tax and adjusting items of £700 million to £800 million for the year, with free cash flow of £460 million to £520 million, both unchanged from August. Management was careful not to sugar-coat what lies ahead, warning that the same headwinds could linger: hard-pressed young shoppers, a promotional market, and a footwear product cycle stuck in transition at some big brands. The half itself was hard going. Sales dipped 0.7% to £5,899 million, with like-for-like sales down 2.8%, and profit before tax and adjusting items fell to £282 million from £351 million. The statutory figure told a cheerier story, leaping 75% to £241 million, though that owed more to accounting on its US options than to trading. North America, JD's biggest market, was the problem child, with a slow quarter for high-heat footwear meeting a jittery consumer. Trainers were soft across the board, down about 3%, while clothing and accessories rose roughly 4%, helped along by a healthy dose of World Cup replica kit. Chief executive Régis Schultz leaned on the phrase "controlling the controllables", and pointed to plenty of strategic progress: new websites in the UK and Ireland, 10 million-plus loyalty members, and a deal to storm into Mexico with 140-odd stores from 2027. Germany has been slimmed down and Eastern Europe is being reorganised and largely sold off. For all the noise, the balance sheet looks robust, with net cash of £168 million before leases, a near-£300 million swing i...