Shares in retailer JD Sports Fashion (LSE: JD) plunged 22% on Thursday after the company warned full-year profits would miss expectations due to “more cautious consumer spending”.
In a trading update, the sportswear firm said sales grew 6% in the 8 weeks to December 30. However, heavy discounting over Christmas led to a decline in gross margins.
As a result, JD Sports now expects to report annual pre-tax profits of £915-935 million – below previous guidance of £1.04 billion.
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CEO Regis Schultz said the company continues to “grow market share” despite increased promotions across the sector. But he cautioned that consumers have become more wary in recent months.
JD Sports’ share price fell to 120.45p on the surprise update. The stock is down 11% over the past year.
