Mike Ashley’s Frasers Group plans more stores as profits soar

theguardian.com:

Mike Ashley’s Frasers Group, the owner of Sports Direct and Jack Wills, plans more acquisitions and store openings after sales rose by almost a third and profits bounced back following the end of high street lockdowns.

Pre-tax profits for the company, which also owns House of Fraser, Flannels, Game and Evans Cycles, and recently bought the online specialists Missguided and Studio Retail, increased to £366m in the year to 24 April from just £8.5m a year before, as sales rose almost 31% to £4.7bn.

Frasers’ new chief executive, Michael Murray, said shoppers had defied expectations that sales had permanently shifted online during the pandemic. The group’s profit rise came despite booking £227m of property impairments as store values declined in the light of fears about the industry’s future.

Murray said: “We have definitely seen a shift back to the high street. People are coming to experience a diverse brand mix.”

He said shoppers were likely to see prices go up in stores as brands reacted to cost increases while the price of fitting out stores had become more expensive because of construction cost increases.

However, the group issued a bullish profits target, saying it believed it could make between £450m and £500m before tax in the year ahead, which would be at least a 23% rise.

Murray said his strategy had got “significant momentum” despite cost inflation and supply chain challenges and the group’s exit from its failed investment in Bob’s Stores and Eastern Mountain Sports in the US after the year end.

“We are confident of a record year and that has got the headwinds baked in,” he said.

The group said it planned to open its first Flannels stores in Ireland – in Dublin, Blanchardstown and Cork – and a flagship Sports Direct in