Sports Direct has said it is starting to see green shoots of recovery at department store House of Fraser, which it purchased from administrators for £90 million last year.
The company, controlled by retail tycoon Mike Ashley, also said a €674 million (£561 million) tax inquiry into unpaid VAT in Belgium is also progressing well and bosses expect a decision on €491 million to be made by early next year.
The revelations come as the business, which has snapped up several under-performing high street names in recent years, saw sales jump 14% in the six months to October 27 to £2 billion with pretax profits up 160% to £193.4 million.
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In terms of sales, it was a strong period for the company, as it focused on its "elevation" strategy of improving stores and winning over big-name brands to be able to sell its most popular products.
Sales in its UK sports retail business, which includes Sports Direct, Jack Wills, Game Digital, Evans Cycles and Sofa.com, rose 6.7% to £1.2 billion, although this growth mainly came from takeovers.
When stripped out, sales fell 8.6%, with bosses saying this was due to "the continuing elevation strategy".
On House of Fraser, the company insisted "green shoots of recovery" are starting to emerge.
READ MORE: House of Fraser delays Sports Direct’s results
Mr Ashley added that recent sales have held up well during Christmas, but warned: "We are doing as much as we can to realistically save as many jobs and stores as possible however, despite our best efforts, there are still a number of stores which are currently paying zero rent and that are unprofitable and thus not sustainable."
The last six months has been relatively stable for Sports Direct, compared with previous periods.
At the company's full-year results earlier this year, publication was delayed after management clashed with auditors over the Belgian tax bill.
Mr Ashley insisted the matter is close to being resolved.
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