Outlook As if owning Newcastle United wasn't bad enough, it seems Mike Ashley's main business – Sports Direct – is also having a torrid time of it. It's still making money – just – but a 90 per cent fall in pre-tax profits is an ugly number and there's no dividend either.
Is it as bad as it looks, though? Delve a little deeper, beyond the horrible headline number, and a different picture emerges. Sports Direct's same store sales are actually increasing and group revenues are strongly ahead. There are some property write-offs linked to an acquisition but the main problem with this year's numbers has been caused by Sports Direct's stakes in other companies – including beleaguered rival JJB – which were held by a stricken Icelandic bank. Inevitably, there is a horribly messy dispute over who actually owns them.
Meanwhile lawyers' letters have been flying back and forth between Ashley and JJB's chairman, Sir David Jones, over a loan the latter received from the former.
Given the obvious strength of Sports Direct's business model – as a discounter it's time really is now – you have to question why Ashley doesn't just give it a rest and focus his attention on his own business. After all, JJB is doing a pretty good job of imploding without his help.