Sports Direct sees profits slump as Brexit vote hits consumer confidence

Sports Direct posted a worse than expected fall in annual profits, as the retail chain warned that economic uncertainty following the country's Brexit vote was proving a drag on consumer confidence.

The firm reported a 15.4% fall in pre-tax profits to £313.4m ($407m, €367.5m) in the year to 24 April, blaming tough trading in the second half of the year.

It faced intense public criticism last year after reports highlighted poor working conditions at its Shirebrook warehouse near Mansfield, which led to founder and Newcastle United owner Mike Ashley vowing before a committee of MPs last month to implement changes.

Chief executive Dave Forsey called the results "disappointing", as the business revealed a 0.8% fall in like-for-like sales, which strips out the impact of new store openings. The year before it posted a 7.4% jump in same store sales, which signalled the end of a run of strong growth at the sportswear chain.

The business posted its second profits warning in a year in March after poor trading.

The chain said its full-year profits fell short of its £420m target, and so would not pay staff bonuses or shareholder dividends.

Sports Direct said: "Since the EU vote we expect the current political uncertainty, and potential weakness in the UK's short to medium term economic outlook, is likely to act as a continuing drag on consumer confidence."

It added that the volatile high street environment and the weakness of the pound against the dollar meant that the outlook was "somewhat uncertain and therefore hard to predict".

The firm added that despite recent reports Ashley has no plans to take the business private, and "indicated his willingness for the company to confirm this statement publicly".

Ashley has also lodged bids with administrators to buy parts of the collapsed department chain BHS.