Sports Direct profits rise but further job cuts at House of Fraser announced
Sports Direct have today reported a 19% rise in profits, after the firm high street retailer announced a rise in half-year pre-tax profits to £193.4m.
Chief Executive Mike Ashley and the company’s shareholders met on Monday and voted to change the retailer’s corporate name to Frasers Group, as part of plans to move upmarket and away from sports.
The group also owns designer fashion brand Flannels, video game shop chain Game Digital, clothing retailer Jack Wills, cycle retailer Evans Cycles, online furniture shop Sofa.com, and national retailer House of Fraser.
The later has faced a lot of uncertainty this year, and 2020 is set to be more of the same, with Ashley stating that more department stores will be closing in 2020.
Regarding the future of House of Fraser, Ashley stated: “During this calendar year we have been integrating House of Fraser into the Sports Direct Group and it is safe to say an awful lot of work has been done by many people of all levels to bring what was – due to the deliberate incompetence of previous management and ownership – an unmitigated disaster into a functioning state.
“A lot has been made about my comments regarding the “terminal” nature of House of Frasers problems. For absolute clarity, as shown by the fact House of Fraser went into administration and indeed was mere hours from liquidation such was its parlous state, the business was dead, finished, destroyed. It was, and it is only through the incredible efforts of those within the Sports Direct Group, including the remaining House of Fraser teams, that we are tackling these problems and trying to build a business with a future, a future for Frasers that is hopefully “bright”.
“I reiterate, we are doing as much as we can to realistically save as many jobs and stores as possible however, despite our best efforts, there are still a number of stores which are currently paying zero rent and that are unprofitable and thus not sustainable. We are continuing to review the longer-term portfolio and would expect the number of retained stores to continue to reduce in the next 12 months.”