JD Sports Shares Rally on £200m Buyback Announcement

JD Sports Fashion plc (LON; JD.) is experiencing a surge in its share price, currently up approximately 5% on Monday, leading the FTSE 100, following the announcement of a new £200 million share buyback program.

The program, slated for execution in FY27, underscores the company's commitment to returning capital to shareholders and aligns with its stated capital allocation priorities.

The buyback will be executed in two tranches. The first tranche, valued at £100 million, commences immediately and is expected to conclude by July 31, 2026, the close of the company's first half of FY27. A second tranche, also worth up to £100 million, will follow.

To manage the first tranche, JD Sports has entered an irrevocable agreement with Merrill Lynch International (“BofA Securities”). BofA Securities will independently execute market purchases of the company's ordinary shares on the London Stock Exchange, operating as a riskless principal.

This arrangement ensures that trading decisions are made independently of JD Sports, within pre-agreed parameters and subject to the company's right to terminate the agreement under customary circumstances.

Shares acquired through the buyback program will be sold back to JD Sports and subsequently either cancelled or held in treasury. The overarching objective is to reduce the company's share capital.

Shareholder authorization for the program, granted at the company's 2025 annual general meeting, allows for the acquisition of up to 515,475,677 shares, with 368,613,803 shares remaining available for purchase at the time of the announcement. The company intends to seek renewal of this authorization at its 2026 annual general meeting.

All share purchases under the program will adhere to the terms of the existing shareholder authority, the UK Market Abuse Regulation, the Commission Delegated Regulation (EU) 2016/1052, and Chapter 9 of the UK Financial Conduct Authority's Listing Rules. Transparency is ensured with announcements of daily share purchases to be made no later than 7:30 a.m. on the following business day.

This buyback announcement signals confidence from JD Sports in its financial position and future prospects. The return of capital to shareholders can be seen as a positive sign, potentially increasing earnings per share and boosting investor sentiment.