As expected JD Sports Fashion has reported a pre-tax loss as its battles to turnaround outdoor chain Blacks and absorbs costs from other acquisitions. The City remains confident that it will hit its full year forecasts.

“With management expecting close to breakeven at Blacks in the second half, this bodes well for outer years, even though much remains to be done yet. While we may fine-tune the balance of divisional numbers, we are leaving our full year pre-tax profit forecast of £65m unchanged at this stage.” - David Jeary, Investec

“We do not expect any major changes to our own or market estimates at this stage with the peak trading period still ahead. Alongside the turnaround potential at Blacks we see international expansion of the core business as a key driver of the investment case whilst a strong balance sheet also gives flexibility and firepower.” - Matthew McEachran, Singer

“Blacks is expected to break-even in the second half and the half has started well in the main sports division, with 3.2% like-for-like sales growth over the first six weeks, although the fashion chains are finding life tough (-6% like-for-like). All in all, JD concludes that the board believes that the group is well positioned to deliver results that are within the range of current expectations.” – Nick Bubb, independent analyst

“The retailer has capitalised on the British sporting summer, with sports fascia sales up by 1.2% over the 26 weeks. Fashion sales have been less resilient, rising by just 0.7% over the 26 weeks and registering a 6% decline over the six weeks to September 8. While this is by no means a crisis, given the greater size of the sports business, it is something that needs to be addressed. Its recent acquisitions of the Tessuti and Originals businesses, designed to improve its presence in the premium male fashion sector, will assist with this.

“JD remains a sensibly run, progressive business and should continue to benefit from the demise of rival JJB. However, it is also a retailer that has, in Sports Direct, a major competitor which currently appears to be exactly in tune with the demands of sports and fashion shoppers. Therefore JD must continue to strive to create an offer around the key tenets of quality, specialism and value that is compelling as possible.” - Matt Piner, Conlumino

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