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Home Sport Football

Newcastle United owner’s company branded ‘total shambles’

Sports Direct branded ‘total shambles’ over latest delay to publish results

Ollie McAninch by Ollie McAninch
2019-07-26 15:26
in Football
credit;PA

credit;PA

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The retailer was due to update the city on Friday morning but said the numbers are still not ready – the second delay this month.

Mike Ashley’s Sports Direct has been called a “total shambles” after the retailer delayed publishing its results for the second time in as many weeks.

The FTSE 250 business, which also owns Flannels, House of Fraser, Evans Cycles and sofa.com among others, had been due to release its full-year results on Friday at 7am.

Investors were keen to hear more about the takeover spree embarked on this year – with House of Fraser of particular interest – after bosses revealed in December last year that it had made a loss of £31.5 million since it was bought for £90 million last August.

But by 8am on Friday, when the stock market opened, the results were still missing, all planned calls with the media and analysts in the City were cancelled, and a presentation to investors at the retailer’s London head office was scrapped.

A spokesman for Sports Direct said: “Unfortunately we are still finalising preliminary results.

“We anticipate that our annual results will still be released today, with a presentation to follow, and will update again at midday.

“Apologies for any inconvenience.”

This was subsequently amended to a 2pm update, and then a 4pm update.

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Mr Ashley also declined to comment when reached on his mobile phone by PA.

Sports Direct was asked why there was a delay, why the company failed to provide an explanation, and whether the decision to postpone was made by the company or its auditors, Grant Thornton.

Sports Direct and Grant Thornton both declined to comment.

Analysts were withering in their condemnation of Sports Direct.

Neil Wilson, chief market analyst at Markets.com, said: “It’s a total and utter shambles, and betrays a number of problems at the business after (Mike) Ashley embarked on his rather random acquisition spree. Above all, it betrays a total disregard for shareholders.

“It not only raises questions about the haphazard way in which the investor relations and finance teams are run, but also could suggest a material problem with the numbers.”

Mike Ashley File Photo
Sports Direct chief executive Mike Ashley was due to update the City on Friday morning (Nick Ansell/PA)

Another analyst due to attend Friday’s meeting, who did not want to be named, told PA: “I’ve never seen a company do this before. On Thursday afternoon we were told we had a place at the meeting. Then we were told at 8.30am on Friday it was off.

“It shows a huge amount of arrogance from the company to treat people with such contempt. Something’s obviously transpired, but what it is is anyone’s guess.”

Under listing rules, Sports Direct has until August 28 at the latest to publish its results or risk potential sanctions.

The results were initially due for publication on July 18 but this was postponed to a later date.

At the time, Sports Direct said the delay was due to “complexities of the integration into the company of the House of Fraser business” which was bought a year ago.

Bosses also blamed “increased regulatory scrutiny of auditors and audits including the FRC review of Grant Thornton’s audit of the financial statements of Sports Direct for the period ended 29 April 2018.”

Shares dropped in early trading when the results did not appear but recovered and were flat by mid-morning on Friday.

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