Mike Ashley sees his fortune swell by £660m

Mike Ashley sees his fortune swell by £660m as value of his retail empire Frasers Group hits an all-time high

In the money: Mike Ashley

Mike Ashley saw his fortune swell by £660m as the value of his retail empire Frasers Group hit an all-time high. 

Shares in the FTSE 250 retailer, whose ever-expanding stable of brands includes Sports Direct, House of Fraser, Evans Cycles and Jack Wills, defied the gloom hitting the sector to post profits of £366m for the 12 months to April 24 compared to just £8.5m a year earlier. 

The reopening of its stores following the end of Covid lockdowns also sparked a surge in sales, with revenues jumping 31 per cent to £4.7billion. The company said it now expects profits of up to £500m this year. Shares jumped 26.6 per cent, or 199.5p, to 949.5p – valuing the company at £4.1billion. 

As a result of the share price surge, retail tycoon Ashley, who founded Sports Direct in 1982 and is chairman of Frasers, saw the value of his 69 per cent stake in the group, held through his company Mash Holdings, expand to £3.1billion. Frasers chief executive Michael Murray, Ashley’s son-in-law who took over at the start of May, said the results were achieved despite ‘significant economic headwinds and well-chronicled challenges across the sector’. 

AJ Bell investment director Russ Mould said: ‘One would have guessed sportswear and equipment sales might be vulnerable to a deteriorating economic climate, yet Frasers remains relatively upbeat.’ 

The record-breaking profit figure was achieved despite the company taking a £227m hit after the value of its stores declined amid fears for the future of the sector as shopping shifted online during Covid-19. 

However, the firm warned inflation and supply chain disruptions were ‘causing challenges for many businesses’ across the sector.

It also flagged an increase in its general running costs and took a swipe at what the company deemed a ‘fundamentally flawed’ business rates system which calculates the amount of tax paid by occupiers of commercial properties. 

Despite this, Frasers outlined plans to open more stores, with its Flannels brand due to expand into Ireland in the coming year with stores to open in Dublin, Blanchardstown and Cork. 

A flagship Sports Direct store is also planned to open in Manchester. 

The results also did not include takings from ecommerce group Studio Retail, which the group plucked from administration in February saving almost 1,500 jobs. Victoria Scholar, head of investment at broker Interactive Investor, said: ‘This is an impressive performance from Frasers Group which has managed to buck the macro negativity and deliver a strong recover in sales post-pandemic. 

She added: ‘Analysts were cautious going into this report with forecasts at the lower end of the company’s own guidance. 

‘While it acknowledged the challenges from inflation, mentioning a significant increase in running costs, the overall trends remain encouraging with investors cheering its upbeat forecast for next year.’

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