Worries over sports retail giant’s profits

Sports Direct founder Mike Ashley
Sports Direct founder Mike Ashley

The boss of a retail chain with a major base and shops in Wigan has admitted the business is “in trouble”.

Mike Ashley said Sports Direct’s full-year earnings are now expected at or around the bottom end of expectations, having already trimmed forecasts when it warned over profits in January.

It comes after shares tumbled six per cent on Tuesday after Mr Ashley’s comments in an interview with The Times sparked concerns over the group’s full-year figures, as MPs increased pressure on him to face questions about the treatment of workers.

In what was described by one retail analyst as a “startling admission”, Mr Ashley - deputy chairman of Sports Direct and the owner of Newcastle United - said the group was “in trouble, we are not trading very well”.

He added: “We can’t make the same profit we made last year.”

Mr Ashley is also facing mounting calls from the Business Select Committee to be questioned in Parliament despite his continued refusal to appear.

He has made it clear he has no intention of agreeing to a request to be quizzed by the committee on June 7, accusing the MPs of abusing the parliamentary process, and has offered instead to give the committee a tour of his head office in Shirebrook, Derbyshire.

In his interview with The Times, he blamed MPs for creating negative publicity that has hit the group’s performance and seen employees miss out on bonuses linked to the firm’s financial targets.

He said: “We are supposed to be taking the profits up, they are not supposed to be coming down, and the more the media frenzy feeds on it, the more it affects us.”

The committee has previously warned he could be in contempt of Parliament if he refused to appear.