- Frasers Group saw pre-tax profits in the first half rise by 8% to £310.2m
- The Sports Direct owner revealed total turnover grew by 4.4% to £2.77bn
- Michael Murray succeeded Mike Ashley as Frasers’ chief executive last year
Frasers Group is entering the Christmas season ‘with great momentum’, the retailer’s boss said on Thursday as the group reported a first-half sales.
The group’s pre-tax profits rose by 8 per cent to £310.2million in the six months ending 29 October following robust performances at its Sports Direct and international retail businesses.
Revenue from the latter segment climbed by 13.2 per cent to £645.8million, thanks to the takeover of Australian online marketplace MySale and purchases of games consoles in Game Spain stores.
Bumper result: Frasers Group revealed pre-tax profits rose to £310.2million in the first half following robust performances at its Sports Direct and international retail businesses
Demand was advance buoyed by growth in Sports Direct’s Irish and British operations, although poor sales at the Game UK and Studio Retail subsidiaries hampered trade at Frasers’s UK sports retail arm.
Total turnover grew by 4.4 per cent to £2.77billion as the company also benefited from acquisitions, including JD Sports Fashion’s non-core UK brands admire Tessuti, Giulio and Scotts.
The takeovers helped boost revenue in the group’s premium lifestyle business by 3.1 per cent, offsetting the effects of a weaker luxury market and House of Fraser store closures.
Michael Murray, who succeeded his father-in-law Mike Ashley as chief executive last year, said: ‘We have delivered a strong performance in the first half of the year, with great momentum as we head into the Christmas trading period.
‘The elevation strategy continues to drive strong trading performance across the business with good growth in Sports Direct supported by our brand partners.’
Frasers’ ‘elevation’ strategy has seen the Derbyshire-based group reinforce ties with major brands, target more affluent consumers, and invest more in flagship stores and online operations.
For example, Frasers has struck partnerships with Nike and Adidas with the aim of expanding internationally and bought shopping centres in Castleford, Luton and Dundee.
Alongside this, the business is pursuing ‘strategic investments,’ building stakes in distressed retailers, such as apparel sellers ASOS and Boohoo, white goods firm AO World and upmarket fashion brand Hugo Boss.
Victoria Scholar, head of investment at Interactive Investor, said: ‘In this ‘sink or swim’ environment for retail, Frasers has emerged as a winner in the sector despite successfully navigating pressures from the cost-of-living crisis.
‘Marks & Spencer is another retailer that has emerged victorious while several others have fallen to the wayside. No doubt Frasers will be pinning its hopes on a bountiful Christmas season during the all-important Golden Quarter for retail.’
Michael Murray noted the ‘strong trading momentum’ had continued into the ‘early recent weeks of the second half.’
He added that the firm was optimistic about achieving annual adjusted pre-tax profits of between £500million and £550million.
Frasers Group shares were 0.55 per cent higher at 913p on Thursday morning and have grown by around 26 per cent since the year began.
