British sports retailer and healthclub group JJB Sports posted a drop in sales for the 22 weeks ending 3 July. Sales dropped 8.9 per cent while like-for-like sales fell by 9.4 per cent. In the six weeks ending 3 July, results took an even greater turn for the worse, with total turnover down by 11.7 per cent and like-for-like sales down by 13 per cent.
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John Stevenson, analyst for Shore Capital, told the FT: “I don’t believe the company has addressed the changes in the market in the last couple of years. They have a lot of challenges: the estage is in need of work, the fashion market has moved away from sports wear, and the market is extremely competitive.” Analyst have also indicated that, aside from a general poor retail climate, JJB is suffering from the effects of competition from rivals like Sports Soccer.
The extreme drop in turnover was partially due to a boost in sales in 2004, with the Euro 2004 footbaal competition during May and June. Had the boost in the sale of football merchandise not occurred, the decline in turnover would have been a less dramatic 6.1 per cent.
Chairman David Whelan confirmed on Wednesday that he was stepping down from his position. In reference to the retail climate, he said: “I do not anticipate any material improvement in retail trading conditions before spring 2006.” Whelan intends to spend more time on his football club, Wigan Athletic. However, the company said that although is role in the company would be “slightly reduced”, he intends “to maintain all his day-to-day contacts and duties, and the duties that he will relinquish will be those more directly related to his former position as chairman of the company.”
Roger Lane-Smith, a non-executive director since 1998 and former senior partner and chairman of law firm DLA Piper Rudnick Gray Cary, has been appointed non-executive chairman.