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Business & Economy

Mike Ashley lambasts “clueless” Corbyn, the Government and rivals as profits rise

Tycoon Mike Ashley has lambasted the “clueless” Jeremy Corbyn and highlighted perceived Government inaction in a remarkable rant amid increased profits at his Sports Direct empire.

The Newcastle United owner says the firm is making pleasing progress against the “significant challenges facing the high street,” with revenues topping the £2 billion mark.

He also said House of Fraser – which the businessman incorporated into his estate in a previous £90 million deal – is “starting to see the green shoots of recovery” following a long period of struggle, though he warned further stores face closure to alleviate its woes.

However, the mogul saved his most colourful revelations for politicians and industry rivals.

Taking swipes as perceived inaction on business rates and Jeremy Corbyn’s criticism of Sports Direct during the General Election, he also hit out at Debenhams bosses over his group’s loss of holdings in the department store when it fell into difficulty and criticised those at five-a-side operator Goals following the collapse of a potential takeover deal.

Mr Ashley unleashed his tirade today (Monday, December 16) in a half-year trading update for the period to October 27.

The figures showed group revenue was up 14 per cent to £2 billion, with reported pre-tax profit 160 per cent higher at £193.4 million and underlying earnings before interest, tax, depreciation and amortisation (EBITDA) up 21.8 per cent to £181.2 million.

According to the results, UK sports retail increased 6.2 per cent to £1.2 billion, with the group’s premium lifestyle division, which includes House of Fraser, rising 79.2 per cent to £282.6 million.

He said: “I am very pleased with the strong underlying EBITDA growth in the context of the significant challenges facing the high street.

“We remain focused on our elevation strategy, which continues to go from strength-to-strength, benefiting all stakeholders.”

Referring to business rates, which have long been criticised by retailers for their financial impact, he said: “The current business rates regime is clearly helping to kill much of what remains of the UK high street.

“A large number of retailers including ourselves have been trying to bring this to the Government’s attention and finally it looks like it is getting some focus; I really hope it is not too late already and would urge parliamentarians to expedite reform before it really does become too late.”

Referring to the outgoing Labour leader, the Newcastle United owner did not pull any punches, nor did he when referring to Debenhams or Goals.

He said: “Mr Corbyn attacked our business during the election campaign, but he really should have checked his facts as he really was shown to be “clueless.”

“He clearly has zero awareness of the fact we are one of the very few groups, and also one of the first, to have a workers’ representative as a statutory director.

“I noted in detail within my report in our full-year 2019 (FY19) results the extent of the outrageous wiping out of the shareholders of Debenhams.

“We named this Project Serpico within the Sports Direct Group at the time as everyone directly and indirectly involved should not be afraid of the truth. We would draw attention below to a further instance since we released our FY19 results which underline why ourselves and independent shareholders remain frustrated victims of, in our opinion, financial crime.

“Goals is another shocking instance whereby various parties are guilty of incompetence or worse, from the auditors to the board, and it is again another example whereby regulators appear to not have enough power to do anything and politicians turn a blind eye.”

Referring to House of Fraser, the tycoon admitted further stores may close to balance the books.

He added: “We have been integrating House of Fraser into the Sports Direct Group and it is safe to say an awful lot of work has been done by many people of all levels to bring what was – due to the deliberate incompetence of previous management and ownership – an unmitigated disaster into a functioning state.

“We are doing as much as we can to realistically save as many jobs and stores as possible, however, despite our best efforts, there are still a number of stores currently paying zero rent and that are unprofitable and thus not sustainable.

“We are continuing to review the longer-term portfolio and would expect the number of retained stores to continue to reduce in the next 12 months.”