Sports Direct has beaten expectations by posting a 10.2 per cent gross profit increase to £184.4 million in the 13 weeks to 22 January 2012.

The sports retailer, which owns brands such as Slazenger and Dunlop, saw total sales rise 9.1 per cent to £453.8 million, aided by a retail sales increase of 10.2 per cent to £408.6 million but hampered by a 1.7 per cent drop in revenues to £45.2 million from its brands division.

The group claimed it is now certain of hitting its underlying pre-tax profit target of £215 million, and that it expects to hit the £225 million mark that will trigger a further bonus share scheme.

This 'super stretch' scheme would see Sports Direct founder and major shareholder Mike Ashley, who also owns Newcastle United FC, pocket six million shares that, at today's price, would be a windfall of over £16 million.

Sports Direct, which recently lost out to JD Sports in the bidding for struggling retailer Blacks Leisure, has pledged to review its dividend policy as a result of its impressive performance, and could be on track to reinstate the dividend after axing it in 2009.

Shares in Sports Direct are currently trading up 5.78 per cent to 278p at 5pm, its highest share price since early 2007 and an almost 50 per cent increase on its low of 190p in mid-December 2011.

Dave Forsey, chief executive of Sports Direct, commented, ‘The group has had a strong third quarter and experienced significant growth in its ecommerce division.

‘Underlying performance in the period, particularly since December, has outperformed management's expectations.

‘Trading has continued to remain strong since the end of January and we shall continue to invest in margin, inventory and extra group marketing,’ he added.

The firm expects to publish preliminary full-year results on 19 July 2012.