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Sports Direct profits fall by a third following collapse in sterling

Profits at Mike Ashley's Sports Direct have plunged by 33.5% to £145.3 million in the first half of the year following the collapse in sterling.

Profits at Sports Direct have plunged by 33.5%. Credit: PA Images

Mr Ashley has come under intense pressure from shareholders over corporate governance over the past six months and also received a dressing down by furious MPs over the summer.

He was also grilled over working conditions at the company's factory in Shirebrook in Derbyshire where it emerged staff were not paid the national minimum wage.

The company said staff morale has suffered because of this but added that demand from workers to move from zero-hours contracts to full employment is "low", but it is exploring arrangements which "may prove more attractive".

The firm has faced criticism over working practices at Shirebrook. Credit: PA Images

The business warned that it expects "strategic challenges and currency headwinds" to continue to adversely affect its financial performance.

The company said revenue rose 4.2% to £1.6 billion, but warned of a challenging environment which the firm expects to continue.

The last six months have been tough for our people and performance. Our UK Sports Retail business continues to be the engine of Sports Direct, but our results have been affected by the significant deterioration in exchange rates, and our assessment of our risk relating to our stock levels and European stores performance.

– Mike Ashley