JJB Sports 'precarious again' after widening first-half losses

The scale of the turnaround facing JJB Sports, the troubled sportswear retailer, was laid bare yesterday after it posted widening half-year losses and "rebudgeted" for lower sales.

But Keith Jones, the chief executive of JJB Sports, said he "remained confident of JJB's return to profitability and growth", although he reiterated its turnaround could take up to five years.

The group – which narrowly avoided administration in March after implementing an insolvency procedure and tapping shareholders for £96.5m – also said there was no need to raise fresh cash into 2012. But it admitted that Christmas trading will be "very important". Indeed, some City analysts already fear again for its future in a market dominated by Sports Direct.

JJB's four main shareholders – Invesco Perpetual, Crystal Amber, Harris Associates and the Gates Foundation, who together account for 85 per cent of its shares – suffered a fresh blow yesterday, as its shares tumbled by 2.75p, or 19.3 per cent, to 11.5p.

Its pre-tax losses nearly tripled to £66.5m for the 26 weeks to 31 July, hit by restructuring charges of £31m. But it was also dragged down by falling sales and margins, as JJB was forced to discount to clear old and obsolete stock.

The group blamed "previous poor buying" for dire football sales. Mr Jones, who joined in March 2010 from Dixons Retail, said: "The reality is that in those two areas [replica shirts and boots] we did not have a differentiated enough offer." To this end, JJB has hired Ray Evans, the former managing director of Kitbag, as director of football.

Its total revenues tumbled by 22.6 per cent to £142.4m, while they fell by 17.7 per cent on a like-for-like basis. JJB's trading has also deteriorated since the second half of September – leaving it significantly behind the "mid-teens" third-quarter sales growth that it forecast in the fund-raising prospectus.

The group has now re-budgeted for lower second half sales. That said, JJB has slashed its annual rent and business rates bill by £8m, following its exit from 49 stores.

Peter Smedley, an analyst at Charles Stanley, said: "Given that current trading is dire and its impact on cash burn, we are concerned that JJB is becoming financially precarious again."

Suggested Topics
Start your day with The Independent, sign up for daily news emails
News
Legendary blues and rock singer Joe Cocker has died of lung cancer, his management team as confirmed. He was 70
people70-year-old was most famous for 'You are So Beautiful'
News
people
Life and Style
fashionOne man takes the hipster trend to the next level
News
John Rees-Evans is standing for Ukip in Cardiff South and Penarth
news
PROMOTED VIDEO
ebooks
ebooksA year of political gossip, levity and intrigue from the sharpest pen in Westminster
News
newsIt was due to be auctioned off for charity
Life and Style
A still from a scene cut from The Interview showing North Korean leader Kim Jong-un's death.
tech
Environment
Sir David Attenborough
environment... as well as a plant and a spider
Voices
'That's the legal bit done. Now on to the ceremony!'
voicesThe fight for marriage equality isn't over yet, says Siobhan Fenton
Arts and Entertainment
Bianca Miller and Katie Bulmer-Cooke are scrutinised by Lord Sugar's aide Nick Hewer on The Apprentice final
tvBut Bianca Miller has taken on board his comments over pricing
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

The Jenrick Group: Night Shift Operations Manager

£43500 per annum + pension + holidays: The Jenrick Group: Night Shift Operatio...

SThree: Trainee Recruitment Consultant - LONDON

£20000 - £25000 per annum + OTE £40,000 + Car + Pension: SThree: SThree are a ...

SThree: Trainee Recruitment Consultant

£20000 - £25000 per annum + OTE £35K: SThree: We consistently strive to be the...

SThree: Graduate Recruitment Consultant

£20000 - £25000 per annum + OTE £35000: SThree: SThree are a global FTSE 250 b...

Day In a Page

Surrounded by high-rise flats is a little house filled with Lebanon’s history - clocks, rifles, frogmen’s uniforms and colonial helmets

Clocks, rifles, swords, frogmen’s uniforms

Surrounded by high-rise flats is a little house filled with Lebanon’s history
Return to Gaza: Four months on, the wounds left by Israel's bombardment have not yet healed

Four months after the bombardment, Gaza’s wounds are yet to heal

Kim Sengupta is reunited with a man whose plight mirrors the suffering of the Palestinian people
Gastric surgery: Is it really the answer to the UK's obesity epidemic?

Is gastric surgery really the answer to the UK's obesity epidemic?

Critics argue that it’s crazy to operate on healthy people just to stop them eating
Homeless Veterans appeal: Christmas charity auction Part 2 - now LIVE

Homeless Veterans appeal: Christmas charity auction

Bid on original art, or trips of a lifetime to Africa or the 'Corrie' set, and help Homeless Veterans
Pantomime rings the changes to welcome autistic theatre-goers

Autism-friendly theatre

Pantomime leads the pack in quest to welcome all
The week Hollywood got scared and had to grow up a bit

The week Hollywood got scared and had to grow up a bit

Sony suffered a chorus of disapproval after it withdrew 'The Interview', but it's not too late for it to take a stand, says Joan Smith
From Widow Twankey to Mother Goose, how do the men who play panto dames get themselves ready for the performance of a lifetime?

Panto dames: before and after

From Widow Twankey to Mother Goose, how do the men who play panto dames get themselves ready for the performance of a lifetime?
Thirties murder mystery novel is surprise runaway Christmas hit

Thirties murder mystery novel is surprise runaway Christmas hit

Booksellers say readers are turning away from dark modern thrillers and back to the golden age of crime writing
Anne-Marie Huby: 'Charities deserve the best,' says founder of JustGiving

Anne-Marie Huby: 'Charities deserve the best'

Ten million of us have used the JustGiving website to donate to good causes. Its co-founder says that being dynamic is as important as being kind
The botanist who hunts for giant trees at Kew Gardens

The man who hunts giants

A Kew Gardens botanist has found 25 new large tree species - and he's sure there are more out there
The 12 ways of Christmas: Spare a thought for those who will be working to keep others safe during the festive season

The 12 ways of Christmas

We speak to a dozen people who will be working to keep others safe, happy and healthy over the holidays
Birdwatching men have a lot in common with their feathered friends, new study shows

The male exhibits strange behaviour

A new study shows that birdwatching men have a lot in common with their feathered friends...
Diaries of Evelyn Waugh, Virginia Woolf and Noël Coward reveal how they coped with the December blues

Famous diaries: Christmas week in history

Noël Coward parties into the night, Alan Clark bemoans the cost of servants, Evelyn Waugh ponders his drinking…
From noble to narky, the fall of the open letter

From noble to narky, the fall of the open letter

The great tradition of St Paul and Zola reached its nadir with a hungry worker's rant to Russell Brand, says DJ Taylor
A Christmas ghost story by Alison Moore: A prodigal daughter has a breakthrough

A Christmas ghost story by Alison Moore

The story was published earlier this month in 'Poor Souls' Light: Seven Curious Tales'