Sports Direct profits fall a whopping 91 per cent

It certainly seems to be raining shit on Newcastle at the moment. Not only do they prepare themselves for the forthcoming Championship season with an uncertain management team, a restless squad and a dreadful away strip, but owner Mike Ashley has taken a fiscal pounding thanks to his underperforming sportswear chain.

Sports Direct, the company in which the rotund businessman owns a 71 per cent share, has suffered a 91 per cent fall in pre-tax profits. Earnings fell from £118.9m to £10.7m this year, even though revenues topped £1bn and sales were up 5.1 per cent.

The huge downturn is a result of the collapse of Icelandic bank Kaupthing Singer & Friedlander (KSF) - the very same organisation that ruined former West Ham owner Bjorgolfur Gudmundsson. The collapse caused the sports retailer to write-off a staggering £53.1 million of shares, which is an awful lot of hoodies and baseball caps.

West Ham’s latest rollercoaster season endures another twist

The breaking news in Iceland is that former West Ham chairman Eggert Magnusson is suing owner Bjorgolfur Gudmundsson for breach of contract and is demanding more than 200 million krona (£1.26 million according to mataf) as part of an agreement regarding the termination of his contract. Magnusson follows Sheffield United, former chairman Terry Brown, Kia Joorabchian and Alan Curbishley in entering or threatening legal proceedings with the luckless Icelander.

But the club deny being in financial trouble

Landsbanki, the bank that West Ham’s Icelandic chairman Bjorgolfur Gudmundsson owns a 40 per cent stake in alongside his son, has been put into receivership and will be taken over by the country’s government.

The news could prove disastrous for West Ham who, having sold players this summer to balance the books, are without a shirt sponsor following the collapse of XL and may be forced to pay Sheffield United in excess of £30 million over the Carlos Tevez affair.

However, an unnamed West Ham board member denied reports that recent developments have left the club in financial danger, telling the BBC:

“This is not affecting West Ham.