14 Jan 2009 07:00
JJB Sports plc ("JJB", the "Group" or the "Company")
TRADING STATEMENT
JJB is today publishing its trading statement which includes information on its trading performance over the period for the five weeks from 8 December 2008 to 11 January 2009.
TRADING UPDATE
Sales trends have continued to be broadly in line with those we reported at the IMS on 10 December. During the 5 weeks from 8 December 2008 to 11 January 2009, Group sales (excluding the Original Shoe Company and Qube), on a like-for-like* basis were 6.8% lower than during the same period last year. This consisted of an 8.4% increase in revenue for health clubs and an 8.0% decrease in retail sales.
Further improvements to the stock holding position have been achieved, with the stock holding in the retail business now 36% lower than last year. The core retail gross margin achieved during the same period was nevertheless still 50 basis points higher than last year, although this is a reduction on the increase achieved prior to the important Christmas trading period. The Company is continuing to aggressively clear non-current stocks.
* LFL sales defined as sales on operating units that have been trading for over 52 weeks
RESULTS TO 25 JANUARY 2009
As a result of the extremely difficult trading conditions experienced in this financial year impacting both sales achieved and also the gross margin as outlined above, the Company is now expecting to record a loss before tax and exceptional items of between £5m-£10m, before any one-off costs associated with the banking facilities, for the 52 weeks ending 25 January 2009. Within this result the LifeStyle division is expected to incur losses of around £15m for the full year.
UPDATE ON POTENTIAL DISPOSALS
Further to the announcement on 10 December 2008, an information memorandum for the sale of the Fitness Clubs business will be released by Lazard to a number of interested parties in the next few days. As the LifeStyle division continues to trade at a loss, the Board is considering its options in respect to the future of this business.
UPDATE ON FINANCIAL POSITION AND BANKING ARRANGEMENTS
The group expects year end net debt to be in line with market consensus of just under £60m. The banks remain supportive of the Company and constructive discussions are continuing with a view to agreeing a basis for providing ongoing support.
Sir David Jones, Executive Chairman of JJB, said:
"We have started a comprehensive review of the business - including product offer, store layout and operating systems. This is an essential part of the plan to re-establish JJB as a major force in the Sportswear Market. We are under no illusions that this is a very difficult task in the present retail environment, but we are determined to succeed."
Enquiries
| JJB Sports plc | 020 7379 5151 |
| Sir David Jones | |
| Lazard & Co., Limited | 020 7187 2000 |
| Melanie Gee | |
| Gregory Bret | |
| Maitland | 020 7379 5151 |
| Neil Bennett | |
| Emma Burdett |
Lazard & Co., Limited is acting solely for JJB in connection with the matters referred to in this announcement and will not be responsible to anyone other than JJB for providing the protections afforded to clients of Lazard & Co., Limited or for providing advice in relation to the matters referred to in this announcement.