FY Jan-22 results in-line and a reassuring outlook This morning JD Sports published its much-delayed full year results, though the numbers themselves held little surprise with FY adj PBT in line with prior guidance and expectations, as was the GBP1.2bn net cash position. More importantly, management sees no material change in consumer demand since the May update and provided guidance for FY23 in line with market expectations. We raise our slightly more conservative EPS forecasts by 2-5%. Following today''s modest relief rally, the shares still only trade on c.9.5x CY22 PE, or 7.5x ex-cash. We reiterate our Outperform rating. Profits more than doubled versus pre-pandemic levels... GBP947m of adj PBT, closely in line with ''circa GBP940m'' prior guidance, is more than twice that achieved in FY Jan-20 (GBP439m). Although this includes contribution from several acquisitions, especially in the USA, it also included UK Sports Fashion achieving a record 19% pre-tax margin despite the impact of lockdowns in Q1 and the pre-existing US business'' margin rising 500bps. Gross margins, +220bps over the last two years, undoubtedly benefited from tight market inventory. However, JD is confident of retaining most gains, with key brands such as NIKE having significantly rationalised wholesale distribution, especially to discounters, over the last two years. ...and are set to be sustained in FY23 Flat year-on-year PBT guidance for FY Jan-23 incorporates the c.5% organic sales growth seen YTD and allows for flat performance in the remainder of the year - realistic in our view given softening US and UK comparatives and recovery potential in Europe and Asia. The company should also see modest acceleration in organic expansion in the year ahead, particularly in Europe but also in USA where its acquired banners have the strong support of key brand suppliers. Long term we think JD has the scope to double its footprint, as set out in: Key debates: a kickabout, 13...