A major high street brand has confirmed it closed dozens of branches across the country, as it warned geopolitical shocks could impact pricing in the future. This week, British retailer JD Sports Fashion revealed it closed 24 stores, on a net basis, in the UK over the past year as it pressed ahead with a focus on “fewer, bigger, better” shops.
It comes as the Bury-based chain, which has more than 4,800 stores worldwide, reported an annual earnings drop of more than 6% for the last financial year in an update this week. JD also warned that while it had no “direct exposure” to the Middle East, with only a handful of franchised stores in the region, the Iran war could push up prices and weaken consumer demand if it leads to higher costs.
The company said: “Over time, the potential future impacts of heightened uncertainty may contribute to direct cost pressures, including energy and fuel costs across our store and logistics networks, respectively, as well as potential indirect impacts on pricing and consumer demand should input cost inflation emerge.”
Due to the uncertainty, JD said it was providing a wider range of profit guidance for the next financial year than it was previously planning.
It was now forecasting a pre-tax profit of between £750 million and £850 million for the current fiscal year, which would mark a decline from the £852 million pre-tax profit that the company made for the year to the end of January 2026.
That figure was down 6.4% compared with the previous tax year. Total organic sales for the group, which excludes the impact of acquisitions, rose by 2.1% year on year to £12.66 billion.
However, in the UK, organic sales dropped by 2.5%, and sales on a like-for-like basis fell by 3.9%, which JD blamed on a “tough consumer backdrop”.
Since the end of the financial year, JD said cold and wet weather had dampened sales and that trading in April was “volatile” with a strong Easter performance followed by fewer visitors to shops.
JD CEO Regis Schultz, said: “We delivered a resilient performance, achieving organic sales growth of 2.1% despite tough market conditions.
“Our deep understanding of our customers and lifestyle trends give us a clear view of how they want to shop and spend, allowing us to consistently deliver the right products, in the right places and at the right prices.
“Whilst we continue to expect muted market growth in FY27 (2027 financial year), we remain confident in JD Group’s medium‑term trajectory, underpinned by our strong brand partnerships and agile, multi‑brand model.”
Commenting on the update, Aarin Chiekrie, equity analyst at Hargreaves Lansdown told the Press Association: “The Middle East conflict hasn’t had a direct impact on JD Sports so far, given its lack of presence in the region, but there’s potential for it to weigh on consumers’ confidence and spending power going forward if energy prices remain elevated.
“Looking to the year ahead, organic sales growth has been flat so far in the first quarter, and the sports fashion market is expected to remain muted in the near term.
“As a result, JD Sports is shifting into a new phase, away from rapid expansion to squeezing the most out of its existing store footprint. We think this is the right approach given the weak spending outlook for its core customer base, and it should help strengthen the balance sheet.
“The group remains a highly cash-generative business, with free cash flows expected to improve further this year.”