Despite a recent improvement in form, Mike Ashley’s football team, Newcastle United, are unlikely to end up in a Champions League spot this season. And Ashley’s other interest, Sports Direct International, should be making more progress in continental Europe than it is, according to analysts.
Ashley has been active in the UK recently, taking stakes or options in the likes of Debenhams and Tesco, as well as Scottish club Rangers. That has helped Sports Direct get concessions in Debenhams and a marketing agreement with Rangers. Analysts at Jefferies said these moves were understandable, but added: “The extent to which resources are being focused on UK trading space inevitably detracts from the execution of the European expansion (in particular we had hoped for more progress in the purchase of brands to fill the obvious gaps in winter and outdoors offerings).”
That could crop up when the company reports second-quarter results on Thursday. As could its controversial zero-hours contracts.
As for the figures themselves, first-quarter sales rose 12% but Jefferies expects a slowdown in the second quarter – partly due to the mild weather – to give growth of 6.2% for the first half. The recent Black Friday and Cyber Monday shenanigans could well boost the figures, but may well have just brought Christmas sales forward.
