How Houthi Attacks in the Red Sea Affected Sales and Profits of British Retail Companies
NYN | Reports and analyses
British newspapers have revealed a significant decline in sales and profits of British retail companies due to the disruption of shipping in the Red Sea, which resulted in negative effects from Houthi attacks on American and British ships. These attacks were attributed to the involvement of these nations in supporting Israeli crimes against Gaza and their repeated assaults on Yemen.
The British newspaper The Guardian reported that JD Sports, a company specializing in sportswear sales, was significantly impacted by the decline in sales caused by delivery disruptions due to the situation in the Red Sea, alongside unfavorable weather conditions.
In this regard, the group, which owns Millets and Blacks, stated that sales of camping gear fell by 5.3% during the six months ending on August 3rd, as “key product lines” were affected by Houthi attacks off the coast of Yemen, causing delays or rerouting of shipments.
It also mentioned that sales in existing stores dropped by 4.6%, amid what the group described as a “challenging and volatile” market in the UK, with profits decreasing by about 14%.
The shipping disruptions coincided with the impact of cold and wet weather, negatively affecting the group’s main sportswear chain in the UK.
As a result of these conditions, shares of JD Sports, which also owns Sprinter in Europe and Finish Line in the U.S., fell by 4.5% in trading last Wednesday after acquiring Hibbett. Similarly, Nike announced a 10% decline in global quarterly sales on Tuesday.
On September 25th, DFS Furniture, one of the largest furniture retailers in the UK, announced a sharp 67.5% drop in its annual profits due to the situation in the Red Sea. The Sanaa government forces have targeted UK-linked ships, forcing them to reroute around the Cape of Good Hope, according to reports from Reuters and The Independent.
According to Reuters, adjusted pre-tax profits from the company’s continuing operations fell to £10.5 million ($14.04 million) for the year ending June 30, compared to £30.6 million the previous year.
The Independent reported that the company informed shareholders that revenues had decreased by 9.3% during the year ending June 30, compared to the previous year.
