Sports Direct in pole position

Sports Direct acquisitions have become a regular occurrence over the last year, so it was little surprise to learn this week about its latest one, clothing website KickBack Sports.

While most retailers have been battening down the hatches in the downturn, others have been taking a different tack, choosing to expand and grow market share.

Sports Direct, which is in the comfortable position of having a strong balance sheet and growing profits, is one of those retailers.

Founder Mike Ashley aims to build a diverse empire to rival that of JD Sports Fashion, which itself has been on a spending spree in recent years.

Sports Direct tellingly set up a ‘premium lifestyle division’ last year in the wake of its acquisitions of young fashion brand USC and upmarket chain Cruise. It also acquired surfwear brand Hot Tuna last month.

Although it lost out to JD in its quest to acquire Blacks Leisure, Sports Direct has not ruled out further acquisitions to bring more brand names under the Sports Direct umbrella, to give the retailer another string to its ‘stack ’em high, sell ’em cheap’ bow.

The expansion continues to pay off. This week the retailer served another ace, revealing that after a strong third quarter, it will meet its EBITDA “super stretch” target of £225m.

And there is more for investors to look forward to this year. The Olympics and Euro 2012 football tournament will provide exceptional opportunities to grab spend as sports fever grips the country in the summer.

But Ashley does not take all this for granted. The store experience has never exactly been a strong point at Sports Direct, but now the retailer is taking action. Last year he revealed a staff incentive scheme where its 2,000 employees will share a pay bonanza of £87.5m.

With acquisitions to go for and the benefits of incentivised staff to reap, it looks like Sports Direct will be on the winners’ podium for some time yet.