Frasers Group has reported falling sales across its retail business in its latest first half results, as it acknowledged “tough” market conditions.

The company’s UK retail sports division recorded a 5.8% drop in sales to £1.33bn, while sales in its premium lifestyle businesses fell 3.7% from last year to £444.5m.

Frasers Group was announcing its H1 figures covering the six months to 26 October and suggested consumer confidence had been “subdued” during the period, while excess inventory had continued to weigh on the industry.

The FTSE 250 company, which owns a range of retail brands including Sports Direct, House of Fraser and Jack Wills, did however report that revenue across the group increased 5% in H1 to total £2.58bn.

In its latest trading statement, Frasers has still reiterated its previous profit guidance of £550m to £600m for the full year.

“We’ve made a solid start to FY26 even though market conditions are tough, consumer confidence is very subdued and excess inventory continues to weigh on the industry, leading to increased promotional activity,” said chief executive, Michael Murray.

“While we remain cautious into the second half, our focus is unwavering as we confront these challenges head-on.”

Head of markets at interactive investor, Richard Hunter, commented that Frasers was “making a good fist of dealing with a notoriously difficult environment”, although he also suggested the company’s outlook was “unsurprisingly cautious” for the remainder of the year.

“The shares have largely recovered from a previous precipitous drop following the profit downgrade, having now fallen by 4% over the last year, as compared to a gain of 4.7% for the wider FTSE 250,” Hunter added.

“Over the last two years the shares are down by 20%, which should in theory leave some positive room for manoeuvre on valuation grounds. Even so, while the market consensus has nudged slightly higher of late to a cautious buy, investors remain mindful that there are perhaps rather better opportunities elsewhere in the sector.”

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