Monday, January 24, 2022

JD Sports sales “robust” as Blacks disappoints

Sporting goods and clothing retailer JD Sports Fashion reported “robust” Christmas trading in financial results published today while outdoor specialist retailer Blacks witnessed “disappointing” sales.

In the seven weeks to January 5th 2013, the sports retailer saw like-for-like (LFL) sales rise 3.2 per cent across the UK & Ireland and, after 49 weeks, cumulative LFLs grew 2.4 per cent.

However, Blacks, which the retailer bought out of administration last January, continues to struggle and a statement from JD Sports acknowledged that change is necessary to bring the fledgling company to profitability in the year ahead.

The statement said: “We will of course be concentrating on delivering a substantial improvement in trading throughout 2013.

“The size and fascia and location structure of the store portfolio continues to be optimised as performance is monitored and lease negotiations progress.

“There are currently 176 stores still in the portfolio. The seven full store refurbishments carried out to date have been well received by key brands and have produced encouraging results overall.

“The outlook for sales improvement should now be positive instore and online. Next year will also see the benefit of cost reductions in various areas of the business and we anticipate that losses will reduce substantially as the new year progresses.”

As a result of such “significant losses”, the group warned that its year end results are likely to be towards the lower end of market expectations of £60 million.

Across its fashion fascias Bank and Scotts, the group has also seen a sales decline, down 7.9 per cent during Christmas trading and falling 3.9 per cent for the 49 week period, though management is said to be “very focussed on improving the performance”.

Peter Cowgill, Executive Chairman, commented: “Christmas 2012 has seen another very robust performance from our core Sports Fascias.

“Both international development in the Sports Fascias and multichannel development throughout the Group represent significant continuing growth opportunities.

“In addition, whilst the performance of Outdoor has been disappointing, we remain confident that this business will produce future returns. As evidenced by results throughout recent years of considerable change, the core of our retail group remains very strong.

“Trading in recent weeks has been the strongest we have seen for some time.”

While the group‘s solid performance is to be applauded, experts have noted that the demise of rivals such as JJB Sports, which went into administration last year, ought to have enticed consumers to shop at JD Sports.

Analyst firm Conlumino‘s Research Director matt Piner said of the results: “JD was afforded a big opportunity this Christmas, with the demise of rival JJB presenting a chance to hoover up high street spending on sports-related products.

“In this sense, the growth is actually slightly disappointing and it‘s likely rival Sports Direct has instead positioned itself as the main beneficiary.

“Growth in a sluggish retail environment is not to be sniffed at and JD Sports has also seen margins recover.

“However, it has been afforded some breathing space by JJB and it is vital that it does not squander this.

“The weaker parts of its business are an unwelcome distraction, but its core offer is also much less compelling than major rival Sports Direct.

“Performance has been flattered this Christmas, but going forward there is no longer a soft underbelly to feed on.”


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