Hollinsbrook Way, Pilsworth
Bury, Lancashire BL9 8RR
Telephone: (+44) 0161 767 1000
Web site: https://www.jdplc.com
Sales: £3.2 billion ($4.2 billion) (2018)
Stock Exchanges: London
Ticker Symbol: JD
NAICS: 448110 Men's Clothing Stores; 448120
Women's Clothing Stores; 448130 Children's and Infants' Clothing Stores
JD Sports Fashion plc helped pioneer the sports fashion trend in the United Kingdom and remains one of that country's leading retailers in sports fashion and outdoor gear. It has also established a global presence, with 30 percent of its revenues originating in Europe and 5 percent from other international locations, including Malaysia, South Korea, Australia, and the United States. The company is best known for its flagship JD Sports store chain, whose shops feature a full range of sports-oriented clothing and shoes, including a wide selection of branded sports fashions from companies such as Nike, Reebok, and adidas. A public company since 1996, JD Sports is controlled by Pentland Group plc, which holds 57 percent of its stock and owns sports and leisure brands such as Speedo, Kickers, Lacoste, and Timberland. JD Sports is led by Executive Chairman Peter Cowgill.
Born in 1944, John Wardle was on his third career when he founded the precursor to JD Sports Fashion in 1981. In his early twenties, Wardle joined the Manchester fire department. From there, he became a civil servant attached to the Ministry of Defense. Wardle was also an avid sports fan, and in the 1960s he had attempted a career as a professional soccer player with the team in Bolton. When an injury ended his professional career hopes, Wardle turned to coaching, becoming an assistant coach for Radcliffe Borough in the 1970s.
By the end of that decade, Wardle had begun to develop plans to open a sporting goods store. Joining him in the business was David Makin, just 18 years old at the time and the son of one of Wardle's close friends. Backed by funding from both Wardle's and Makin's families, the partners opened their first store in Mossley, Bury, in 1981. Makin and Wardle called their first store Mossley Sports.
By the mid-1980s sports equipment had more or less vanished from the JD Sports stores. Instead, the company's sports fashions range benefited from the rapid expansion of the branded sports clothing market, as brands such as Nike, adidas, Reebok, and Puma succeeded in transforming consumers into walking billboards across the United Kingdom. Backed by the new fashion trend, JD Sports opened new stores in Liverpool and Sheffield into the middle of the decade.
Wardle and Makin initially focused on expanding their retail chain in the Northern and Midlands markets, leaving other British markets to fast-growing rivals including the First Sports chain operated by the Blacks Leisure group and JJB Sports. Into the early 1990s, however, JD Sports began its expansion into the United Kingdom's most heavily populated southern markets, especially the all-important London market. The company opened its first London store on Oxford Street in 1989.
The first half of the 1990s provided more strong growth for the company as the sports fashion trend emerged beyond the youth market to become a dominant fashion trend among all consumer segments. The company's early entry into the market in the meantime had given it a strong relationship with many of the major names in the sector, allowing the company to remain at the leading edge of new clothing and footwear designs and fashions. Wardle and Makin launched a new expansion phase for the company, scouting out new locations and raising the company's total store portfolio to 50 stores by 1995. By 1996 the company had topped 60 stores, with total sales of £56.4 million.
Despite strong growth, the company continued to face heavy competition not only from other major sports fashion specialists but also from the larger retail sector as more retailers added branded and other sports fashions to their product mix. To remain competitive, it developed a new expansion plan aimed at doubling the number of its stores by the end of the decade. To fund this effort, the company went public in 1996, listing its shares on the London Stock Exchange. The floatation valued the company, by this time called John David Sports plc, at nearly £133 million. Wardle and Makin each sold 15 percent of their 50 percent stakes, sharing a total of £26 million. The cash enabled the partners to buy up control of the Manchester City football club.
The public offering also provided the backing for JD Sports' new expansion drive. By the end of the 1990s, the company had more than doubled its number of stores. The period was not without its mishaps, however. The Irish Republican Army's terrorist campaign of the mid-1990s directly affected JD Sports, when two of its Manchester stores were destroyed by bombs, costing the company some £650,000. Then, in 1998, its attempt to steer its product mix toward a more mainstream consumer segment failed to capture customers' interests. By then the company's share price had slipped dramatically.
During 1999 JD Sports worked to correct its product mix, redeveloping its line of exclusive designs in partnership with major brands. The company also shifted its focus from the purely sports-oriented market represented by adidas and Nike to include the fast-growing leisure brand segment, represented by brands such as Lacoste, Thomas Burberry, and Fred Perry. With the opening of its 126th store that year, JD Sports once again posted sales gains as turnover neared £143 million. The company also gained control of its own clothing line with the purchase of the Cobra brand in 2000.
At the start of the 21st century, JD Sports appeared to have found the proper product mix, as its yearly revenues surged past £200 million in 2001. The company also continued to develop its retail network, boosting its total number of stores to 149. With profits climbing past £16 million for the year, the company's share price reflected its newfound retail strength. This resurgence prompted founders Wardle and Makin to cash in on part of their investment, each selling an estimated 7 percent stake.
If the First Sports acquisition had succeeded in eliminating one of JD Sports' major rivals, it also eliminated the company's own profitability. In May 2003 the company posted its first losses since its public offering. Wardle agreed to resign as executive chairman. By the beginning of 2004, both Wardle and Makin had agreed to step down from management positions in the company they had founded. Soon after Wardle sold another 11.5 percent of his stake to the Pentland Group, which had built up a strong portfolio of sports and leisure brands, including Speedo, Timberland, Kickers, and Lacoste. The executive chairman spot was then filled by Peter Cowgill, who had previously served as the company's finance director.
By this time JD Sports had become known as the John David Group, or JD Group. While sports and leisure remained its core retail focus, the JD Group had also begun to eye an expansion into the larger fashion market. As part of that process, it established a separate division for its struggling retail fashion stores, which included the Open, Size?, and Athleisure names. The company then set out to shore up the division, buying the 23-store RD Scott chain for £4 million. The purchase gave the company access to the range of brand names featured in RD Scott stores, including Ted Baker, Firetrap, Rockport, and Henri Lloyd.
In May 2005 Wardle and Makin completed their exit from the JD Group. They agreed to sell their remaining stakes in the company to the Pentland Group, which paid nearly £45 million, boosting its stake in the company to 57 percent. The purchase price reflected the pall cast over much of the British clothing retail sector at mid-decade. Indeed, the difficult trading period had hit the JD Group's rivals just as hard. By the end of 2005, one of the group's larger competitors, Allsports, had been forced to declare bankruptcy. Allsports had been the sector's fourth-largest player, with 270 stores throughout the United Kingdom.
The collapse of Allsports provided the JD Group with its next expansion opportunity. In November 2005 the company made an offer of £18 million for 178 of the Allsports stores. Under the purchase agreement, the JD Group was given the right to operate the Allsports stores for a trial period before completing the individual purchase of each site. In this way, it was able to identify the locations with the greatest potential for profitability. By February 2006 the company had decided to take over just 91 of the Allsports locations. These were subsequently whittled down to just 73 stores. Because the Allsports stores were typically smaller than the JD Sports stores, the company again initially intended to maintain the brand identity of its new acquisition. By May of that year, however, it decided to rebrand all 73 locations under the JD format. That process was completed by early 2007.
The company's move to place its brands into airport shopping venues foreshadowed its international expansion plans, which began in 2009 with the acquisition of the Chausport brand and its 75 stores in France. The company had long been a sponsor and official supplier of numerous sports clubs, and in 2009 it acquired rugby brands Canterbury, Canterbury of New Zealand, and Kooga Rugby. In 2010 another corporate name change was undertaken, and the JD Group became formally known as JD Sports Fashion plc, most commonly referred to, once again, as JD Sports. That same year JD Sports acquired the Champion Sports brand, with nearly two dozen stores in Ireland, and purchased a 50.1 percent share in Sprinter, whose 47 stores were located in Spain.
During the next decade, JD Sports continued its successful growth through the acquisition of well-known sports and athleisure clothing brands, as well as through the purchase of networks of branded stores in its two main segments: sports fashion and outdoor active wear and gear. In 2012 the company acquired the trade and assets of 290 stores operated in the United Kingdom by the Blacks Leisure Group plc. Within months the worst-performing stores had been closed, and the acquisition weighed down the company's performance during the next year as it worked to get the remaining Blacks stores up to par.
By 2017 JD Sports was well on its way to establishing a strong global presence, with 56 new stores in Europe and 9 in the Asia-Pacific region, including in Malaysia and Australia. The company was the leading European retailer in its category, with revenues of £2.37 billion for the year and more than 1,000 stores in Europe and the United Kingdom.
Results for 2018 were even stronger, as Cowgill announced in April. Revenues of £3.16 billion marked a 33 percent increase from the previous year. Cowgill also noted that a JD Sports store had just been opened in Helsinki, Finland, and the company had acquired a 50 percent stake in the South Korean brand Hot-T, whose stores would be converted to the JD Sports name, starting with its first one in Seoul.
The year 2018 was noteworthy for yet another milestone in the company's history. With its $558 million acquisition of The Finish Line Inc., an Indiana-based sports and leisure retailer with 555 stores plus 375 shops within Macy's stores throughout the United States, JD Sports entered the lucrative American athleisure market in a big way. Calling it “a momentous step in JD Sports' global expansion,” Cowgill noted that the company intended to retain Finish Line management and build on the company's strengths as a foundation for growth of JD Sports in North America.
M. L. Cohen
Updated, Pamela Willwerth Aue
Ark Fashion Limited; Go Outdoors Topco Limited; Iberian Sports Retail Group SL; JD Sports Fashion German GmbH; JD Sports Fashion Holdings Aus Pty; JD Sports Fashion SDN BHD; JD Sports Fashion South Korea; JD Sports Fashion SRL; JD Sports Fashion Sweden AB; JD Sports Gyms Limited; Mainline Menswear Holdings Limited; Sportiberica Sociedade De Artigos De Desporto S.A.; Sprinter Megacentros Del Deporte SLU; Tessuti Limited; Tiso Group Limited; 25Squared Retail Limited & 25Squared Agency Limited.
N. Brown Group PLC; Sports Direct International PLC; Venue Retail Group AB Series B.
“British Retailer Completes $558M Acquisition of IndianapolisBased Finish Line.” Indiana-Business Journal, June 18, 2018.
Daggem, John. “Changing the Game.” Herald Sun (Melbourne), July 7, 2018.
Javed, Ayesha. “JD Sports Targeting Asia-Pacific and US as It Posts Record Results.” Daily Telegraph (London), April 18, 2018.
“JD Set to Expand into South Korea as It Inks Joint Venture Deal.” ProactiveInvestors, September 15, 2017. Accessed July 11, 2018. http://www.proactiveinvestors.co.uk/companies/news/184050/jd-set-to-expand-into-south-korea-as-it-inks-joint-venture-deal-184050.html .
“JD Sports Sprints Higher as Athleisure Craze Helps to Drive Record Profits.” ProactiveInvestors, April 17, 2018. Accessed July 11, 2018. http://www.proactiveinvestors.co.uk/companies/news/195131/jd-sports-sprints-higher-as-athleisure-craze-helps-to-drive-record-profits-195131.html .
“New Identity for John David Group.” Manchester Evening News (England), April 18, 2010.
Ruddick, Graham. “JD Sports Dragged down by Blacks Losses.” Daily Telegraph (London), September 18, 2013.
Thompson, Susan. “New Purchase Gives JD Sport a Taste of the Tough Outdoors.” Times (London), April 13, 2012.