Annual Report & Accounts
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2016 Annual Report & Accounts Annual Report & Accounts 2016 Contents Overview Highlights 5 Milestones 6 Who We Are 8 Where We Are 26 Executive Chairman’s Statement 47 Strategic Report Business Model 48 Our Strategy 49 Principal Risks 51 Business Review 53 Financial Review – Continuing Businesses 54 Property and Stores Review 56 Corporate and Social Responsibility 58 Governance The Board 64 Directors’ Report 65 Corporate Governance Report 68 Directors’ Remuneration Report 73 Financial Statements Statement of Director’s Responsibilities 82 Independent Auditor’s Report 83 Consolidated Income Statement 86 Statement of Comprehensive Income 86 Statement of Financial Position 87 Consolidated Statement of Changes in Equity 88 Consolidated Statement of Cash Flows 89 Notes to the Consolidated Financial Statements 90 Group Information Five Year Record 144 Financial Calendar 145 Shareholder Information 145 3 Annual Report & Accounts 2016 “Record result with headline profit before tax and exceptional items of £157.1 million.” Peter Cowgill Overview Highlights Revenue Profit Before Tax and Exceptional Items Overview £1,059.5m £1,258.9m £1,216.4m £1,522.3m £1,821.7m £77.1m £60.5m £82.0m £100.0m £157.1m 2012 2013 2014 2015 2016 2012 2013 2014 2015 2016 Total Dividend Payable per Ordinary Share Adjusted Basic Earnings per Ordinary Share 6.32p 6.58p 6.78p 7.05p 7.40p 26.47p 22.13p 30.82p 38.89p 61.34p 2012 2013 2014 2015 2016 2012 2013 2014 2015 2016 Net Assets Net Cash £229.2m £251.8m £272.8m £310.0m £400.8m £60.3m £45.6m £45.3m £84.2m £209.4m 2012 2013 2014 2015 2016 2012 2013 2014 2015 2016 Group Revenue Wholesale 5% Multichannel Rest of the World 14% 1% Retail Stores Europe 81% 22% UK 77% 5 Annual Report & Accounts 2016 Milestones SCOTLAND #BETHEDIFFERENCE April 2015 September 2015 • 2015 ‘FACE OF JD’ COMPETITION LAUNCHES • KINGSWAY WAREHOUSE EXPANSION PROGRAMME COMPLETE July 2015 October 2015 • NEW FLAGSHIP STORES OPEN ON • NEW FLAGSHIP STORE OPENS IN - OXFORD STREET, LONDON NIEUWENDIJK, AMSTERDAM - NORTHUMBERLAND STREET, NEWCASTLE August 2015 • FIRST JD STORE IN BELGIUM OPENS IN ANTWERP © 2015 adidas AG Overview November 2015 January 2016 • FIRST JD STORES OPEN IN • FIRST JD STORE IN ASIA OPENS IN - ROME (ITALY) KUALA LUMPUR, MALAYSIA - STOCKHOLM (SWEDEN) - COPENHAGEN (DENMARK) • NEW FLAGSHIP STORE OPENS ON March 2016 ARGYLE STREET, GLASGOW • PURCHASE OF THE TRADING ASSETS AND TRADE December 2015 OF AKTIESPORT AND PERRY SPORT FASCIAS • PINK SODA SPORT LAUNCH (FEMALE • ENGLAND FOOTBALL HOME KIT LAUNCH OWN BRAND ATHLEISURE RANGE) • JD GYMS RECEIVES BEST BUDGET GYM AWARD • FOOTBALL FEDERATION KIT LAUNCHES (SCOTLAND, WALES, NORTHERN IRELAND) WITH JD AS EXCLUSIVE RETAILER 7 Annual Report & Accounts 2016 Who We Are The Group has over 900 stores across a number of retail fascias and is proud of the fact that it always provides its customers with the latest products from the very best brands. The Group embraces the latest online and instore digital technology providing it with a truly multichannel, international platform for future growth. Overview Oxford Street London, UK Sunway Pyramid, Kuala Lumpur, Malaysia 9 Annual Report & Accounts 2016 Who We Are Northumberland Street, Newcastle Upon Tyne, UK Overview Nieuwendijk, Amsterdam, The Netherlands Argyle Street, Glasgow, UK 11 Annual Report & Accounts 2016 Who We Are Mary Street, Dublin, Ireland Fields Mall Fields Shopping Centre, Copenhagen, Denmark Overview Mall of Scandinavia, Stockholm, Sweden Calle jacarilla, 7, Elche, Spain 13 Annual Report & Accounts 2016 Who We Are Kleistrasse, Monchengladbach, Germany Overview Roma Est Mall, Rome, Italy Aeroville, Paris, France Meir, Antwerp, Belgium 15 Annual Report & Accounts 2016 Who We Are Footpatrol, Berwick Street, London UK Overview Manchester,Size?, Carnaby UK Street, London, UK Elche,Scotts, Spain The Trafford Centre, Manchester, UK 17 Annual Report & Accounts 2016 Who We Are Chausport, Centre Commercial Auchan V2, Lille, France Sprinter, Poligono Vizcarra Nave 14, Elche, Spain Overview Ultimate Outdoors, Deepdale Retail Park, Preston, UK Millets, Tulketh Street, Southport, UK Blacks, Sheffield, UK 19 Annual Report & Accounts 2016 Who We Are Established in 1981 with a single store in the North West of England, JD Sports Fashion Plc is now a leading international multichannel retailer of sports fashion and outdoor brands. Overview Who We Are Overview JD is acknowledged as the leading specialist multiple Established in 2000, Size? specialises in supplying retailer of fashionable branded and own brand sports the finest products from the best brands in footwear, and casual wear in the UK and Republic of Ireland apparel and accessories. Initially set up to trial edgier combining globally recognised brands such as Nike, product collections before introducing them to the adidas and The North Face with strong own brand mass market through the JD fascia, the Size? offer labels such as Mckenzie, Carbrini, Supply & Demand has since grown to include its own roster of highly and The Duffer of St George. JD continues to increase sought-after worldwide exclusive product releases. its presence in the European market with additional Outside of the UK and Republic of Ireland, Size? now stores in all existing European territories. The recently has stores in France, the Netherlands, Italy, Germany opened store in Kuala Lumpur, Malaysia is JD’s first and Denmark. venture outside of Europe. Footpatrol is London’s best-known destination sneaker Chausport operates throughout France retailing store, with a history in supplying the most exclusive leading international footwear brands such as Nike, footwear. It has been at the heart of supplying the adidas and Le Coq Sportif together with brands sneaker fraternity with the most desirable footwear, more specific to the local market such as Redskins. apparel and accessories. Specialising in new and classic sneakers, limited editions, Japanese exclusives and rare deadstock, Footpatrol is based in the heart of Soho on Berwick Street. 21 Annual Report & Accounts 2016 Who We Are Sprinter is one of the leading sports retailers in Spain Scotts retails fashion and sport led brands with selling footwear, apparel, accessories and equipment authority to older, more affluent male consumers for a wide range of sports as well as lifestyle casual largely beyond school age, stocking brands such wear and childrenswear. Their offer includes both as EA7, Lacoste, Fred Perry, adidas Originals and international sports brands and successful own brands. Pretty Green. KELL BROOK IBF WELTERWEIGHT CHAMPION OF THE WORLD 160317 SCT15109 Annual Board Report DPS 210x297_3mm FA.indd 1 18/03/2016 08:42 Tessuti’s vision is to become the first choice retailer for Cloggs is TESSUTI.CO.UKan online niche retailer of premium branded branded premium menswear fashion in the UK. The footwear. Cloggs also has three stores in Shrewsbury, current stores offer customers a strong mix of brands York and Newcastle./TESSUTIUK @TESSUTIUK @TESSUTIUK including Hugo Boss, Ralph Lauren Polo, Canada Goose and Stone Island. Overview Who We Are Overview Mainline Menswear is an online niche retailer Getthelabel.com is an online and catalogue business of premium branded Men’s apparel and footwear, which offers customers significant savings on branded stocking brands such as Armani, Hugo Boss and fashion and footwear. Ralph Lauren. Kooga Annual Report DPS_PRINT.pdf 1 3/21/16 3:19 PM C M Y CM MY CY CMY K JD Gyms offer exceptional fitness facilities in five prime Kooga design, source and wholesale rugby apparel city centre locations. JD Gyms have the latest gym and equipment, with teamwear, replica and equipment and workout techniques, providing a whole leisurewear ranges. Kooga is also sole kit supplier host of effective fitness classes and unrivalled onsite to a number of professional rugby clubs. support and advice. JD Gyms was announced as the ‘Best Budget Gym’ at the 2015 National Fitness Awards. 23 Annual Report & Accounts 2016 Who We Are Kukri Sports is an international sportswear Focus are involved in the design, sourcing and manufacturer supplying bespoke teamwear to many distribution of footwear and apparel both for own leading schools, colleges and universities. In addition, brand and licensed brands, such as Peter Werth, Kukri is sole kit supplier to a number of high profile Fly 53, Ecko, Ellesse, and Voi Footwear, for both professional teams and will once again be the official Group and external customers. kit supplier to Team England for the 2018 Commonwealth Games. Source Lab Annual Report DPS_PRINT.pdf 1 3/21/16 3:15 PM C M Y CM MY CY CMY K Source Lab is a football license business in the UK Nicholas Deakins was launched in 1991 and is firmly working with some of the biggest and best known established as one of the UK’s leading footwear and names in world football designing, sourcing and clothing lifestyle brands with a reputation for distributing mono branded apparel as well as innovative, original design and quality manufacture. supplying club retail operations. Source Lab has an Nicholas Deakins will celebrate their 25th Anniversary impressive license portfolio which includes Chelsea, in September 2016. Arsenal, Manchester City and Barcelona. Overview Who We Are Overview Blacks is a long established retailer of specialist With a strong emphasis on own brands, such as Peter outdoor apparel, footwear and equipment. Trading Storm and Eurohike, our Millets outdoor stores are the online and from approximately 60 stores, Blacks port of call for a more leisurely