Amidst torrid economic news, JD Sports today had something brilliant to shout about.
Profits for the year doubled to a magnificent £654 million. Revenues rocketed to £8.5 billion. There is a juicy dividend for investors, who must be delighted.
Which genius is behind this result?
Erm, Peter Cowgill, who was ousted with immediate effect in May after a fine from the CMA and concern he had too much power in the boardroom.
Probably he did, but surely that was for the board to sort out?
This looks like one of those PR problems that is not remotely the fault of the actual PR people (the agency was MHP, now it is Finsbury, to whom, best of luck.)
Today’s statement doesn’t mention Cowgill by name, but is fairly scathing about “regulatory issues”, “risk management” and “governance systems”.
The board, almost entirely new, now has to find someone to replace him.
Since he took that business from nearly nothing to a stock market value of £6 billion it is hard to see that anyone comparable would want the job.
To replicate Cowgill’s performance, the new person would have to take the company to a market cap of £12 billion. That looks unlikely in any circumstances and impossible presently.
In the meantime, some of us will note what the share price was when Cowgill left – about 125p – and make that the reference point for the newcomer.
JD Sports had to change. And plainly corporate governance wasn’t Cowgill’s best subject.
But unless there is much more to come on this – the company insists its investigations are concluded and there is nothing new to know – it is hard to see how everyone would not be better off if there was a new, more vigorous board with the plainly excellent Cowgill still running the actual business.
