The financial turnaround of the troubled British sporting goods retailer is expected to take up to three years, according to the management. JJB Sports reported an operating loss of £24.6 million (€28.1m-$39.0m)on 10 percent higher revenues of £184 million (€210.3m-$291.7m) in the first half of the year through the end of January, but the result was an improvement compared with the first half of 2009, when JJB made a loss of £41.9 million on revenues of £167.3 million. The improvement could be attributed in part to the higher sales of replica football clothing during the Fifa World Cup.
In the six-month period, gross profits rose to £77.6 million (€88.7m-$123.0m) from £60 million in the prior year, representing a gross margin of slightly more than 42 percent of sales. The company expects full-year gross margin be around 40-42 percent this year, with an increase in sales promotions. JJB has decided to increase promotional activity to support autumn and peak-season sales. In September, it launched a “Save and Spend” initiative that offered shoppers vouchers giving them a discount of £5 on purchases of at least £30 pounds (€34.3m-$47.6m).
The company pointed out that the first refurbished store in Slough has consistently performed ahead of the rest of the group with the same ranges that are available in the rest of the chain. A further five refurbished stores will be in operation before the end of October.
In the first half, JJB restructured its management. Ron Rome became retail director in April, and the company appointed Kate Hayes, a former international retail director at Ben Sherman and a buying director at Nike, as trading director last month. The company recently reported that Debbie Robinson, formerly head of food marketing at The Co-Operative Group, will run JJB’s marketing department.
