Sports Direct profits plunge

Sports Direct (LON:SPD) has reported a 57 percent slump in profits from £166.4m to £71.6m.

Founder Mike Ashley said the last six months has been “tough for our people and performance”

“What matters most to me is how tough the last year has been for the people who work at Sports Direct. Our people have once again found themselves in the spotlight through no fault of their own, yet they remain hardworking and loyal.”

Sports Direct has found itself in the spotlight this past year following an undercover Guardian investigation, which exposed staff being paid less than minimum wage and described the working conditions as “closer to that of a Victorian warehouse than that of a modern retailer”. Since then the company has been forced to pay over £1 million in back pay to staff.

Keith Hellawell, the chairman of Sports Direct, has accused trade unions, media and MPs for creating a damaging campaign against the sports retailer.

“I have no doubt that the extreme political, union and media campaign waged against this company has not only damaged its reputation and influenced our customers, it has impacted negatively on the morale of our people.

“I begin to question whether this intense scrutiny is all ethically motivated.

“One of the most damaging consequences has been for the very people our critics supposedly support. The board accepts responsibility for our shortcomings, but there has also been disproportionate, inaccurate and misleading commentary.”

Since the first disappointing results since Ashley took over as Chief Executive, he has said that the company will continue efforts to becomes the “Selfridges” of sports wear.

“Our UK Sports Retail business continues to be the engine of Sports Direct, but our results have been affected by the significant deterioration in exchange rates, and our assessment of our risk relating to our stock levels and European stores performance,” Mr Ashley added.

The group’s shares have more than halved in the last 12 months, falling to 315 pence.