Almost 200 jobs have been put at risk of redundancy after JD Sports confirmed plans to close one of its major distribution centres.
The Greater Manchester-headquartered group, which is listed on the London Stock Exchange, is to shutter its location at Derby Commercial Park.
The move comes after JD Sports penned a 20-year lease on the 514,000 sq ft site three years ago.
A JD Group spokesperson said: “We have made the difficult decision to close our Derby distribution centre and are working with all those affected to ensure they are fully supported through this challenging period.”
It is understood that the move follows a strategic review of the group’s global supply chain network.
The JD Sports employees affected by the decision have entered a six-week consultation while the group is working to see if alternative roles are available within the group.
The group added that the announcement will have no impact on its distribution centre in Rochdale.
Up and down performance for JD Sports
The announcement comes after JD Sports reported a dip in full-year pre-tax profit as it flagged a “challenging and volatile” market.
Profit before tax and adjusting items came in at £917.2m, down 7.5 per cent, which the sports retailer said reflected continued investment in its supply chain and a number of new stores.
Sales growth of nine per cent meant revenue in the 12 months to January held steady at £10.5bn, up 2.7 per cent.
The results came after JD Sports downgraded its profit forecast for the financial year in January, due to higher discounting in its stores and reduced customer spend.
However, JD Sports recently reported good global sales growth in the second quarter of 2024, smashing analysts’ expectations and leading to the share price rising by over six per cent in early trades.
Like-for-like sales at the FTSE 100 firm rose 2.4 per cent in the 13 weeks to 3 August, 2024, or 0.7 per cent in the first half. Organic sales rose 8.3 per cent or 6.4 per cent for the first half of the year.
The company said the trading improvement was “driven primarily by the strength of our multi-brand operating model and softer comparatives with the previous year”.
Growth was strongest in North America, where sales grew 5.7 per cent on a like-for-like basis. In Europe, sales growth came in at three per cent.
JD Sports has over 3,337 stores worldwide selling brands including Nike trainers and North Face hiking gear.