JD Sports dismissed rumors that Peter Cowgill is looking to step down as CEO, even as documents show he banked handsome bonuses while the company took pandemic-related government funds.
The British athletic retailer confirmed “to both investors and to its international brand partners that the board is not engaged in a process to recruit a chief executive officer or chairman,” it said in a statement Monday, adding that the company “is continually reviewing the depth of its management team to ensure that the senior operational leadership team in the business has the necessary skills and experience to exploit the ongoing global development opportunities.”
“In conjunction with the senior leadership team, I look forward to welcoming investors and analysts to our second Capital Markets Day and to sharing our strategy and execution plans for the further development of JD over the forthcoming years,” Cowgill said, referencing the investor day the retailer plans to host on Oct. 13.
For the past 17 years, the businessman has been executive chairman at JD, where he began as chief financial officer in 1996 before leaving four years later only to return as CEO in 2004. Questions around whether Cowgill might hand over the CEO title and continue on in the executive chairman capacity came to a head in May, when news of JD’s Oi Polloi purchase broke and documents named the seasoned leader as a director.
JD has executed a number of high-profile acquisitions in recent years, raising about 400 million pounds ($549.1 million) earlier this year to replace the $325 million used to acquire Shoe Palace in December. It paid $495 million for DLTR in February, and took a 60 percent stake in Polish retailer Marketing Investment Group S.A.
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Meanwhile, Cowgill voluntarily took a 75 percent cut in his basic pay last year due to the Covid-19 pandemic, similar to executive action across the industry. But an annual filing noted that he also was paid more than 5 million pounds ($7.1 million) in bonuses last year.
The Guardian reported that JD Sports received over 100 million pounds ($141.7 million) in government support last year, raising questions about the timing of the retailer’s decision to begin shareholder dividend payments.
In April, the company said that profit before tax for the year ended Jan. 30, 2021, fell 7 percent to 324.0 million pounds ($457.9 million), or 32.19 pence a diluted share (44 cents), on a 1 percent revenue gain to 6.17 billion pounds ($8.47 billion).
Separately, the company on Thursday said it will execute an intergroup sale of its Sports Unlimited Retail Retail BV (SUR) to Iberian Sports Retail Group SL (ISRG), JD’s 50.02 percent subsidiary based in Spain. SUR was a wholly-owned company based in the Netherlands operating under the Aktiesport and Perry Sport nameplates.
JD said that the rationale for the sale was that ISRG is more focused on the sporting goods sector than the core JD brand, and that its management would be better able to drive growth and higher returns at SUR for the longer term. Because JD is the parent firm of ISRG, it will continue to make strategic decisions regarding ISRG’s future. ISRG will pay JD 16.5 million euros ($20.1 million) upon completion of the transaction.
“We have an excellent management team at ISRG and, having successfully integrated the Sport Zone business into its operations, this is the right time for ISRG to further expand its geographical reach. By consolidating our sporting goods businesses under the ISRG umbrella, we are absolutely confident that the transfer of SUR to ISRG will bring long term development opportunities to both the team at SUR and their international brand partners,” Cowgill said.