Sporting goods retailer Sports Direct said profits rose 21 per cent in the year to April 26th, as the company announced plans to cut its bonus scheme earnings target for 2016 after failing to make the acquisitions necessary to boost sales.

The group, founded and majority controlled by Newcastle United owner Mike Ashley, said underlying pretax profit for the year to April 26th was £300 million (€430 million), ahead of forecasts of £293 million and up from £249 million a year ago.

A 5.5 per cent rise in sport retail sales helped push total revenue up 4.7 per cent, with the group’s gross margin up 110 basis points to 43.8 per cent.

Sports Direct’s permanent staff are incentivised by lucrative share bonus schemes linked to group earnings targets.

The company said on Thursday it would revise down its 2015/16 adjusted core earnings target of £480 million to £420 million, as it now considered it to be unreasonably challenging after failing to fuel its expansion with acquisitions over the past year.

All other targets for the further three years of the scheme to 2019 remained unchanged.

Reuters