JJB Sports, the U.K. sporting goods chain, reported same-store sales climbed 13.1% in the six-week period between Sept. 27 and Nov. 7. But management indicated that results were “lower than anticipated” due to excessive promotions and reflected the “weakening market environment.”
Gross margins eroded to 33.8% in the six weeks. That compares to a gross margin in the year-to-date period of 40.6%.
In the three months ended Nov. 7, comps grew 11.5% and gross margins were 37.6%.
“The Board believes that current trading conditions are having and will continue to have a negative impact on its expectations for the full year,” JJB said in a statement. “However, as we said in our update on 28 September 2010, the full year outcome remains heavily dependent on our performance during the important pre-Christmas and New Year sale periods.”
Shares of JJB were also under pressure last week as some analysts speculated that the retailer may be required to seek additional financing. Net debt increased to £16.6 million ($26.6 mm) as of Nov. 7 from £1 million ($1.6 mm) as of Sept. 27.
