Sports Direct Shares Tumble As Mike Ashley Admits Group Is 'In Trouble'

Sports Direct Shares Tumble As Mike Ashley Admits Group Is 'In Trouble'

Under-pressure retailer Sports Direct saw its shares tumble after founder Mike Ashley admitted the group was "in trouble" and would see profits fall this year.

The group's shares dropped 9% as Mr Ashley - deputy chairman of Sports Direct and the owner of Newcastle United - said he blamed MPs for creating negative publicity that has hit the group's performance.

He told The Times: "We are in trouble, we are not trading very well. We can't make the same profit we made last year."

He added: "We are supposed to be taking the profits up, they are not supposed to be coming down, and the more the media frenzy feeds on it, the more it affects us."

The group, which runs around 400 stores across the UK, warned over profits in January after poor trading amid unusually warm weather over the Christmas period.

It said at the time it was no longer confident of meeting its underlying annual earnings target of £420 million, and instead expected to turn in earnings of between £380 million and £420 million.

But independent retail analyst Nick Bubb said Mr Ashley's comments in the interview with The Times were a "startling admission".

He added: "You might have expected an announcement this morning from Sports Direct revising down their profit guidance, but no such announcement has yet been forthcoming."

Mr Ashley recently described the members of the Business, Innovation and Skills Committee as a "joke" after refusing to be questioned in Parliament about working conditions at the company.

MPs are discussing what action to take after Mr Ashley snubbed the summons to appear following criticism of the way his company treats workers at their warehouse in Shirebrook, Derbyshire.

On Monday he reiterated his refusal to attend the committee and added he would not "stand idle" while the company is "subjected to public vilification".

The committee has previously warned he could be in contempt of Parliament if he refused to appear.

The company has been accused of exploiting staff through zero-hours contracts, under which employees do not know how many hours they will work from one week to the next.

But Mr Ashley said no workers at the Shirebrook warehouse are employed on this type of contract, and that they are used in stores "as a flexible and progressive way of creating retail jobs".

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