JD Sports Fashion scores as Sports Direct stumbles

Peter Cowgill’s chain has wowed the City with its latest results while his rival is down in the dumps

Sportswear is no longer just for running, which helps explain JD Sports’ success (Getty)

Poor old Sports Direct. Just as everyone is throwing mud at Mike Ashley’s company along comes JD Sports to add insult to injury.

Sorry, JD Sports Fashion. Peter Cowgill, the executive chairman, can expound at length about the concept of “ath-leisure” which has taken performance sportswear from pitch and track to the street and the nightclub. Hence the “Fashion”.

Getting on that horse is making for a winning ride for his company, at a time when Mr Ashley is nervously awaiting the vet.

​Despite occupying different niches in the sportswear market – JD will sell you the latest trainers, SD focuses on discounting – they both have things in common.

They both make their livings from selling lots of branded sports goods. They are both led by larger-than-life individuals. They are both expanding internationally and they both thumb their noses at what is considered best practice when it comes to the way companies are governed.

Their recent numbers, however, are a study in contrasts, emphasised by JD’s latest which showed a 73 per cent jump in pre tax profits to £77.3m at a time when SD’s earnings are dropping like a stone.

Perhaps it helps that Mr Cowgill says he is willing to listen. For sure, he’s the undisputed boss. I’m not sure I’d relish being on the wrong side of a tongue lashing from him and he’ll rather quickly tell you if he thinks you’re talking rubbish.

But successful businessmen only remain successful while they keep their ears to the ground; while they are willing to take note of what their advisors and their customers and their investors and their staff are saying to them.

Mr Ashley has proved reluctant to do that. We’ve all seen the unlovely results. Mr Cowgill appears to have heeded the danger. So no one’s too worried about his bearing the title “executive chairman” when governance experts say the chair should run the board while overseeing the work of the chief executive who runs the company. It’s to avoid too much power being concentrated in one pair of hands.

I’d also give Mr Cowgill props for his views on the rising minimum wage, which Sports Direct has, until recently, had such trouble paying. While it increases his costs, he’s sanguine about it because it boosts the spending power of people who shop at JD.

Supporters of increasing wages at the bottom (like me) have long argued that doing so puts money into the economy because the people in jobs that pay the minimum, or just above it, spend most of what they earn. If it means have a little extra to splash out on the higher-priced fashion that JD Sports Fashion hawks as opposed to Sports Direct’s discount clobber, well, why not?

It’s not all been plain sailing for JD. The outdoor division, including the Blacks and Millets chains, is still losing money, although it managed to narrow losses to £2.3m from £4.5m.

But if JD keeps it up, that ad where the football crowd sings “sportsdirect.com, Britain’s number one”? It isn’t going to stand up to scrutiny for much longer.