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07 June 2019

Yeezy does it for JD Sports as it enters FTSE 100

Sportswear retailer JD Sports is set to be promoted to the FTSE 100 in the index’s quarterly reshuffle.
Despite wider gloom for the High Street, the sportswear group now has a market capitalisation of more than £6bn, propelling it into the top flight.

Roy Kaitcer, Investment Manager, said: “JD Sports’ rise to the FTSE 100 has been driven by a phenomenal performance over the last 15 years, and has outperformed the otherwise struggling retail sector.

“This has been partly due to its fashion brands and its relationships with the likes of Nike and Adidas - they sell the clothes that teenagers want to buy.”

Indeed, JD Sports and fellow sports retailer Footlocker were the scenes of excitement when the Adidas Yeezy Boost 350 v2 Black Static trainers went on sale on Friday (7th June 2019). The trainers, the result of a collaboration between Adidas and rapper and entrepreneur Kanye West, saw “Yeezy madness” spread among young people as they queued up outside branches of the stores to get hold of the £180 footwear.

Engineering software firm Aveva is also now a FTSE 100 company after an increase in demand for industrial software and the securing of contracts with key customers saw its pre-tax profits rise more than 35% from the previous year to £46.7m. The company’s growth has also been supported by its merger with the software arm of French energy group Schneider Electric in 2017.

Marks & Spencer has narrowly missed relegation from the index after confirming a £600m rights issue and a cut in its full-year dividend to help fund a joint venture with online grocer Ocado last month.

easyJet is to leave the FTSE 100 along with Hikma Pharmaceuticals. In its half-year results in March 2019, the budget airline said economic uncertainty affecting the wider airline sector had contributed to a £272m loss, along with rising fuel prices and competition around fares. However, chief executive John Lundgren said the airline had performed in line with first-half expectations despite the tough economic conditions and the business was “well-equipped to succeed in this more difficult market.”

Entering the FTSE 250 in the reshuffle will be promotional merchandise marketer 4imprint Group, multi-platform media company Future, Belfast-headquartered software company Kainos Group, pub group and brewery Marston’s, digital payment services companies Network International Holdings and Paypoint and hospitality company PPHE Hotel Group.

Construction company Kier Group is to drop out of the FTSE 250 after seeing its shares fall 40% after it issued a profit warning on Monday 3rd June, although the share price has since recovered some ground. The firm, which supplies services to the public sector, said operating profit will be £25m lower than previously expected this year and its “Future Proofing Kier” programme will be around £15m higher than anticipated.

Also dropping out of the FTSE 250 will be online gaming company 888 Holdings, Civitas Social Housing, speciality pharmaceutical company Indivior, retirement income planning group Just Group, over-50s specialist service provider Saga and logistics company Stobart Group.

The changes to the index will take effect from Monday 24th June 2019.

Ends

Please note, past performance and forecasts are not reliable indicators of future results or performance.
Please note that this article is for information only and does not constitute a recommendation to buy or sell the shares of the investments mentioned.


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Yeezy does it for JD Sports as it enters FTSE 100

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