British sportswear and clothing retailer Frasers stuck to its financial guidance for 2022-23 after reporting a 39 percent rise in first-half profit that reflected the success of its drive to take the group upmarket.

The FTSE 100-listed firm, formerly called Sports Direct, owns brands including House of Fraser, Flannels, USC and Jack Wills.

Founder Mike Ashley still controls Frasers, owning 69 percent of its equity, but the business is run by Michael Murray, Ashley’s son-in-law, who became chief executive in May.

Murray is pursuing a so-called “elevation strategy” with investments in flagship stores and in online, the deepening of ties with brands such as Nike and Hugo Boss and acquisitions including fashion brand Missguided and Gieves & Hawkes.

While most UK retail stocks have seen sharp declines in 2022 amid a cost-of-living crisis for consumers, shares in Frasers are up 9 percent.

Finance chief Chris Wootton said the group was able to defy the downturn because of the breadth of its product offer.

“It’s the choice across the whole group from top luxury at Flannels down to own brand stuff in our Sports Direct stores and everything in between,” he told Reuters on Thursday.

Wootton said the group was also benefiting from the work it has put in to improve relationships with brands. “The level of product we’re getting from these brands, it’s chalk and cheese from what it was five or six years ago,” he said.

Frasers also said it plans to invest £600 million ($730 million) over the next 10 years in a new distribution centre and offices in Coventry, central England.

The group said it still expected full-year adjusted profit before tax of £450-500 million, up from the £344.8 million made in 2021-22, though it warned that “the macroeconomic environment is clearly challenging.”

It made adjusted profit before tax of £267.1 million in its first half to Oct. 23 and recorded a 12.7 percent rise in revenue to £2.64 billion, largely due to acquisitions.

“We have delivered a strong performance during the period, despite the challenging backdrop of heightened economic uncertainty in the UK, soaring energy costs, rapidly rising inflation, a widespread cost of living crisis and continued geopolitical instability,” Frasers said.

The group said post-pandemic issues with the global supply chain were beginning to ease.

By James Davey; Editors: Paul Sandle, Jason Neely and Arun Koyyur

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