Hurt by tough comparisons with last years World Cup and a harsher
retail environment, JJB Sports reported sales for both its retail
stores and health clubs fell 4.3%. Same-store sales dropped 4.4%.
The U.K. sporting goods chain said the most significant impact has been
the tough comparisons set by the 2006 World Cup. While total retail
store revenue is down 6.2% on the comparative period, retail store
revenue excluding replica products decreased by 1.3% over the same
period. The combined gross margin improved 280 basis points versus the
same period last year.
Pre-tax profits reached approximately £8 million ($16.2 mm) against
previous expectations of £11.5 million ($23 mm) and well below the
£19.8 million ($40.2 mm) achieved in the same period last year.
The group added that it was reviewing the strategy of shop-in-shop
policies with Nike and adidas within its stores. At the same time, JJB
is seeking to increase the proportion of “own brand products” within
its stores and is negotiating with a number of brands to acquire their
U.K. distribution rights, enabling JJB to achieve a higher proportion
of revenues from its own labels.
Looking ahead, JJB said that it was “prudent to assume” that profits
over the full year were likely to be between £35 million ($71 mm) and
£12 million ($24.3 mm) below the companys former expectations.
