Mike Ashley releases statement warning of coronavirus impact on his retail empire
Mike Ashley has given a warning regarding the performance of his retail empire.
Friday morning seeing Ashley release the statement via Frasers Group.
Whilst Sports Direct stores still retain the name, Mike Ashley recently rebranded the Sports Direct International Group to Frasers Group, in order to try and dilute the toxic negativity that surrounds the brand and his overall empire.
Today’s statement sees Mike Ashley warn that his company will almost certainly not meet their financial targets.
The NUFC owner blaming the impact of the Coronavirus.
It is also widely reported that Ashley has asked landlords to reduce rents for his stores due to the current downturn caused mainly by the virus.
The Frasers Group share price has fall drastically over the past four weeks, from 503p on 20 February 2020 to 236p at 10.30am today (Friday 20 March 2020), a fall of 53%.
Mike Ashley owns around two thirds of the Frasers Group shareholding, meaning the paper value of his shareholding has more than halved these past four weeks.
Ashley has also provoked controversy with Newcastle United.
Many Premier League clubs (including Palace, Liverpool, Brighton and Man Utd) have responded to the Coronavirus impact by making public commitments to full-time staff about their wages and promising to still pay casual match day staff despite games being cancelled. However, so far Mike Ashley has refused to make any public commitment to Newcastle United staff.
The statement from Mike Ashley via Frasers Group:
“Whilst it is too early to estimate what the full impact from COVID-19 will be on the Company’s performance for the current financial year ending 26 April 2020, and future periods, the Board expects that COVID-19 will cause significant disruption to its business, including reducing customer footfall, and therefore expects that Frasers Group will not achieve the range of guidance of 5 to 15% Ebitda growth previously given for the financial year ending 26 April 2020.
“Accordingly, and given the ongoing uncertainty, the Company is no longer giving formal guidance in relation to the financial year 2020.
“Frasers Group’s year-to-date performance had been in-line with expectations prior to COVID-19.
“The Company has a strong management team which can adapt and respond quickly to challenges and changing market conditions.
“Over the longer term, the Board remains confident in focusing on the Company’s elevation strategy.”
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