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Answers demanded from Sports Direct boss

Ashley faces grilling from MPs over unexplained closure of USC fashion chain

MIke AshleySports Direct tycoon Mike Ashley is expected to face a grilling from MPs on the Scottish Affairs Committee over his decision to close the fashion chain USC with minimal notice.

Scottish Labour MP and committee chairman Ian Davidson is hoping to bring Mr Ashley in front of the committee before parliament is dissolved in four weeks time ahead of the May General Election.

Mr Davidson said: “The Scottish affairs committee is investigating how employees in small businesses are treated when big bosses decide to shut down a company or sites. Following our inquiry into the closure of City Link, we are now inviting USC and Sports Direct management, and Mike Ashley, as the directing influence of this group, to meet with the committee.”

There have been questions about whether Mr Ashley would respond to an invitation to attend but rarely, if ever ,does anyone who is called fail to do so.

USC went into administration in early January, although 200 workers at the Dundonald warehouse in Ayrshire weren’t told until after they had loaded up a series of trucks which arrived unexpectedly to clear it of products.

The company was immediately bought back in a “pre-pack administration” by Republic, another of Mr Ashley’s companies. But questions remain over why USC fell into administration as accounts show it was making a profit.

** Sports Direct (19th) reported group sales for the 13 weeks ending 25 January 2015 were up 2.6% to £771.0m (2014: £751.6m) and gross profit increased 7.6% to £346.9m (2014: £322.3m).

Dave Forsey, chief executive of Sports Direct International, said: “As we highlighted at our interim results in December, trading has been in line with management’s expectations. Within Sports Retail we continue to focus on upgrading our store portfolio and integrating our business in Austria where a weak Winter sports season across Europe has proved challenging.

“While we retain the ability to invest in margin, inventory and group marketing to deliver long term sustainable growth, the Board is very confident of achieving at least our full year internal underlying EBITDA target of £360m, before the charge for the Employee Bonus Share Schemes.”

The company will report full year results on 16 July. 

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