The investment will focus on Flannels, its luxury fashion chain, the retail conglomerate controlled by Mike Ashley said in a results statement that was delayed by a week to allow audit work to be completed. The group, until recently known as Sports Direct, provided few other details and made no comment on current trading.
Group pre-tax profit before exceptional items fell 20 per cent to £143m for the year to April 26, from £179m last time, on sales that were slightly higher at £3.95bn. An analyst survey compiled by Capital IQ forecast pre-tax profit at £135m. Frasers withdrew its own financial guidance in March when the pandemic struck the UK.
Profit fell 14 per cent in the UK sports retail division, which accounts for half of the group’s total. But that was partly offset by an improvement at Premium Lifestyle, which includes Flannels and the House of Fraser department stores. The unit made a £4.5m profit compared with a £37m loss last year.
The company said it expected more House of Fraser stores to close, repeating what it said last year, but did not provide details. The group has 48 stores, with many on flexible lease terms following the department store group’s administration in 2018.
The retailer added that it would still consider freehold property acquisitions. It has spent £203m on properties over the past year.
“Long-term leases will be signed with collaborative landlords and those willing to co-invest in the elevated store model,” the group said. “However, it is possible further store closures will occur over the coming year where such terms cannot be agreed.”
Like most retailers, Frasers benefited from a big rise in online sales during the 12-week UK lockdown, though it provided no figures. Its value-focused Sports Direct stores were popular with shoppers when they reopened in June.