JD’s full year results injured by ‘volatile trading environment’ in October

JD has today revealed a dip in sales during its third quarter. Dented by a “softer October” the company said that its full-year trading is expected to be at the lower end of its £955 million to £1.035 billion guidance.

In the 13 weeks to 2 November, group revenues were down by 0.3% and UK sales were down 2.4%. Gross margin increased from 0.3% to 48.1% with the year-to-date gross margin for the Group now at 48.2%.

The company said it had a “strong back-to-school period” but a “softer consumer demand and trading toward the end of the period”.

At the end of the period, like-for-like sales growth was 0.5%. Stores continued to outperform online and footwear continued to outperform apparel in the 12 weeks.

During the period, JD opened 79 new stores, taking the total number of openings by the end of Q3 to 181.

Régis Schultz, CEO of JD, said: “After a good start to the period, helped by strong back-to-school sales, we saw increased trading volatility in October, particularly in North America and the UK, reflecting elevated promotional activity and mild weather.

“Against this backdrop, we maintained our commercial discipline, improving gross margin by 0.3%pts while still delivering 5.4% organic sales growth. In addition, we made further, strong progress on our long-term growth strategy including opening 79 new JD stores across the world.

“We have performed well in the key trading events this year and we are well-positioned for the upcoming peak season. The trading environment remains volatile though and, following October trading, we now anticipate full-year profit to be at the lower end of our guidance range.”

JD now expects Profit before tax and adjusting items to be at the lower end of its original guidance range of £955-1035 million.