Good morning: Twelve years ago this week I wrote a profile of a little known, secretive, publicity-shy entrepreneur called Mike Ashley for The Sunday Times. There were no photographs to go with the piece — the best we could dig up was a teenage Ashley playing squash — and no comment from the man himself. Despite ranking 96th on the Rich List, with an estimated £500 million fortune, he had, at that point, never uttered a public word. We dubbed him retail’s “quiet man”.
It is not a sobriquet you would append to Mr Ashley today. The Sports Direct founder is now the poster boy for much that is (perceived) to be wrong with capitalism, a convenient whipping boy for MPs, the business establishment and corporate governance wonks. There is no shortage of photos: from shirtless shots of him downing pints with fellow Newcastle football fans to the staged pictures of him holding his fists aloft that accompanied an interview about his relationship with the City and shareholders.
Sports Direct has announced full-year results this morning. Like those photos, it is not pretty. Pre-tax profits are down 22 per cent at £281 million, despite an 11.7 per cent increase in revenue. On an underlying basis profits fell by 58.7 per cent to £113.7 million.
Nevertheless Mr Ashley is upbeat: “Sports Direct is on course to become the ‘Selfridges’ of sport by migrating to a new generation of stores to showcase the very best products from our third-party brand partners. We have invested over £300 million in property over the last year, and I am pleased to report that early indications show that trading in our new flagship stores is exceeding expectations.”
Alongside the results Sports Direct has announced the appointment of Jon Kempster as chief financial officer after a three-year search.
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Markets snap
FTSE 100 stalwart Unilever has posted interim results this morning. Underlying sales growth has come in at 3 per cent, up from 2.9 per cent in the first quarter but a fraction below City expectations and at the bottom of Unilever’s 3 to 5 per cent target range. Nevertheless Unilever has reaffirmed its full-year target.
Its chief executive, Paul Polman, says: “Our first-half results show continued growth well ahead of our markets and a substantial step-up in profitability despite the persisting volatile global trading environment.”
Dame Carolyn McCall, chief executive of Easyjet, is bowing out on a high. Alongside an upbeat trading update the airline has nudged up full-year profit forecasts and expects to make a headline profit of between £380 million and £420 million this year. It was announced this week that Dame Carolyn is to join broadcaster ITV as chief executive.
We have interim results this morning from Moneysupermarket.com and Howden Joinery and trading updates from Premier Foods, Anglo American and SSE among others. In the US Microsoft will update investors after the bell tonight.
On the economics front we get the latest rate decision from the European Central Bank at lunchtime. The central bank is widely expected to hold interest rates steady but may lay the groundwork to announce a reduction in its bond-buying programme in September.
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We get the official UK retail sales data for June at 9.30am. A Reuters poll of City economists suggests that year-on-year sales have risen by 2.5 per cent.
Leading business figures will meet the prime minister later today in an attempt to build bridges between companies and Downing Street as part of preparations for Brexit. Among them are Sir Roger Carr, chairman of BAE Systems, Dave Lewis, chief executive of Tesco, and John Pettigrew, chief executive of the National Grid. Philip Aldrick, our economics editor, has a preview of the meeting here.
Finally, if you get a chance make time to read today’s obituary for Lord Bagri, who rose from a teenager working in the Calcutta docks to become chairman of the London Metal Exchange.
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