JD Sports reported a record first-half profit for a second year in a row on Tuesday helped by higher sales of sports fashion and said it was looking to expand internationally, sending its shares to a new peak.
JD Sports has been a British retail sector success story in recent years, exploiting the growing demand for sports branded shoes and clothes to overtake rival Sports Direct as the country's biggest sportswear retailer by market value.
Shares in JD Sports rose as much as 8.2 percent on Tuesday, making them the highest percentage riser on the FTSE mid-cap index, before slipping back to trade 5.0 percent higher at 1043 GMT, or a rise of 34 percent so far this year.
Sports Direct has been under fire for the way it pays and treats its employees and communicates with investors, but JD Sports said any gain from its rival's woes was only marginal as the two firms were targeting a different range of customers.
Hargreaves Lansdown analysts said JD Sports appeared to be doing better than its rival by focusing on quality, promoting well-known sports brands rather than pushing lower-cost own-brand goods once shoppers are through the door.
"Not so long ago Sports Direct was an all-conquering FTSE 100 giant, with JD Sports struggling in their shadow. Today, despite all the headlines, JD Sports is the bigger fish.", Hargreaves analyst Nicholas Hyett wrote in a note.
JD Sports, which also runs fashion and outdoor retail chains such as Scotts and Blacks, reported a 73 percent jump in first-half pretax profit to a record 77.4 million pounds, underpinned by a 20 percent rise in headline revenue to 970.6 million.
The company, which has most of its 900 stores in the United Kingdom but is expanding in the Netherlands, Spain, France and Germany, said underlying sales at its core sports fashion business rose about 10 percent in the period.
"Whilst it would be unreasonable to expect organic growth to continue at these levels, JD does have a very strong base from which to exploit the ongoing opportunities both in its core UK market and, increasingly, internationally," the company said.
It said net cash at the end of the first half stood at 232 million pounds, more than double its 100 million a year ago.
"If we make acquisitions, it is likely to be overseas to continue to expand internationally," Chief Financial Officer Brian Small told Reuters.
"We would never rule out anything (in the UK), but it is a market where we have a very strong position already and we are very focused on overseas expansion," Small said.
JD Sports opened 20 stores in Europe in the first half and will be unveiling more in 2016, notably flagship style stores in Brussels and Cologne. It also expanded in Malaysia and Australia.
(Editing by David Clarke)