MIKE Ashley’s Sports Direct has revealed annual profits more than halved after it was left exposed by the pound’s plunge following the Brexit vote.

The retailer reported a 58.7 per cent tumble in underlying pre-tax profits to £113.7m for the year to April 30.

Newcastle United owner Mr Ashley said the group had taken action to limit the impact of the pound’s heavy falls against the US dollar, but warned “we remain exposed” to longer-term sterling woes.

The group, which sources many of its branded goods in US dollars from Asia, said it was “optimistic” for the year ahead, targeting underlying earnings growth of between five per cent and 15 per cent, despite ongoing pressure from the pound.

It said the rollout of a new store format was bearing fruit, with better-than-expected early results.

Mr Ashley said: “We will continue to be conservative in managing for the medium to long-term, which may result in short-term fluctuations in underlying earnings before interest, tax, depreciation and amortisation, particularly given the continued uncertainty surrounding Brexit.”

Like-for-like retail sales edged 0.3 per cent higher over the year, while total revenues rose 11.7 per cent as its international sales benefited from the weaker pound.

Sports Direct warned after last June’s EU referendum that profits would be hit because the company failed to hedge against the fall in sterling in the immediate aftermath of the vote, meaning the weak pound impacted its product-buying power.

Its financial troubles have come amid a storm of controversy surrounding Sports Direct and Mr Ashley.

The 52-year-old tycoon has been embroiled in a court case this summer with an investment banker over a £15m deal allegedly struck in a London pub, with Mr Ashley still awaiting the verdict.

It comes as the business continues to recover from the damage to its reputation after allegations last year over working practices at its Derbyshire headquarters, with Mr Ashley hauled before MPs, including former Hartlepool MP Iain Wright, for a grilling.

The group said on reporting its results that it had “made positive progress across the business as we continue to strive to ensure that all of our people are treated with dignity and respect”.

Mr Ashley said it has “smashed the ball out of the park with the Selfridges of sport concept”, having been widening the reach of its stores by partnering with other brands.

As well as pumping more than £300m into new stores, he has snapped up a raft of stakes in struggling high street firms, most recently a 26 per cent holding in struggling Game Digital.

He has also bought stakes in Debenhams, French Connection and Findel.

Sports Direct, which has notched up ten years as a listed company, also announced it has appointed Jon Kempster as chief financial officer.

His appointment follows a string of senior departures at the group, with former chief executive Dave Forsey quitting last year - only to be replaced by Mr Ashley.