Profits at Sports Direct have plummeted nearly 60%, which the firm says is largely due to the weaker pound.
Underlying pre-tax profit fell to £113.7m, down from £275.2m last year, because of “currency movements and increased depreciation charges”.
Chief executive Mike Ashley said it had now taken steps to “minimise the short-term impact of currency volatility”.
Sports Direct’s reputation has been badly hit by revelations about staff conditions at its Derbyshire warehouse.
Chairman Keith Hellawell said the company had made “positive progress” across the business as it continued to “strive to ensure that all of our people are treated with dignity and respect”.
A recent survey of workers in Shirebrook, to which 3,300 people responded, had showed that an “overwhelming majority” of people in the warehouse “currently feel they are treated with respect”, he added.
Staff had elected the company’s first UK workers’ representative and Mr Hellawell said he had “no doubt” their “contribution will prove invaluable to the board as the Sports Direct family continues to move forward together”.
‘Selfridges of Sport’
Sports Direct, which has been without a chief financial officer since last October, also said it had appointed Jon Kempster to the role. Mr Kempster is set to join the company on 11 September.
The company’s key strategy is to turn itself into the “Selfridges of Sport”, and Mr Hellawell said the “elevation of our retail proposition continues to be a key objective”.
The results statement announced that it was forming a “new strategic partnership” with sportswear firm Asics.
The Japanese company will manage dedicated areas within Sports Direct’s new upmarket “premium” stores.
Neil Wilson, senior market analyst at ETX Capital, said this was a “transformational” year for Sports Direct.
Progress was being made on the new premium stores, he said, and they were “a lot more profitable than the existing Sports Direct stores”.
In recent months, Sports Direct has bought 26% stake in Game Digital, increased its stake in Debenhams, acquired lingerie firm Agent Provocateur and snapped up the US sports clothing and outdoor equipment chains Bob’s Stores and Eastern Mountain Sports.
The company’s “spending spree on acquisitions” had affected profits, Mr Wilson said.
“That’s something to bear in mind when we’re looking at these figures and also what that does is it puts Sports Direct in a better position to make a strategic move in, for example, the department store area or in the US with its US acquisitions.”