Newcastle United owner Mike Ashley's Sports Direct issues profits warning

Sports Direct has issued a profits warning after an unseasonally-warm run up to Christmas.
Sports Direct has issued a profits warning after an unseasonally-warm run up to Christmas.
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Sports Direct, the sportswear firm controlled by Newcastle United owner Mike Ashley, has issued a profits warning, blaming the unseasonal weather over Christmas.

It said it is no longer confident of meeting its forecast underlying annual earnings target of £420million, and now expects to turn in between £380million and £420million.

The announcement by the group comes less than a month after it posted its half-year trading results, adding it was "confident" of hitting its original earnings target.

Last month Sports Direct posted interim results, showing a 3.6% rise to £166.4million in underlying pre-tax profits for the six months to October 25.

The news comes as high street leaders Next and Marks & Spencer posted dips in trading over Christmas, citing the unusually warm winter weather.

Last month Sports Direct pledged to pay its employees above the national minimum wage, in a move that will cost the firm £10million.

The group said it will pay all its directly employed staff and casual workers more than the minimum wage from January 1.

It comes after the firm faced allegations over low wages, that it forces compulsory unpaid searches taking around 15 minutes on staff as they leave, and that it docked the wages of employers who clocked in just one minute late.

The probe prompted condemnation from the Unite union, which called the atmosphere at Sports Direct "gulag working conditions".

Senior Labour MP Chuka Umunna described the retailer, which runs around 400 stores across the UK, as a ''bad advert for British business''.