Sports retailer sounds second profits warning
JJB Sports dealt a further blow to the retail sector today after lowering profits expectations in the wake of a tough Christmas season.
The group said turnover in the six weeks to January 2 fell 2%.
The sluggish festive period meant it was forced to bring forward its sale to December 13 and this resulted in a sharp deterioration in margins.
In its second profits warning in five months, UK-based JJB said annual profits were expected to be in the range of £61m (€86.8m) and £64m (€91m), compared with market expectations for a figure of around £67 million.
City forecasts were also scaled back in August after the company warned of a 20% profits shortfall in the wake of poor demand for summer ranges.
JJB chairman David Whelan said he was “disappointed” with the performance but said measures were already in place to tackle the problem area of clothing.
Christmas turnover in footwear, replica kit and equipment improved on last year but JJB said competition in the value-for-money sector put pressure on its clothing range, despite selling 5% more items than a year earlier.
In the trading period for the 23 weeks to January 2, JJB said total turnover for its stores and health clubs fell 1.6% and by 1.1% on a like-for-like basis.
JJB currently operates from 437 outlets, including 189 out-of-town superstores and 146 smaller high street shops. The company said it planned to open 40 sites in 2005, including many with health clubs attached.
In October, JJB rebuffed a takeover approach – thought to be from private equity group Cinven and worth a possible £600m (€853.9m).
Shares in the group were 2% lower today.
