SPORTSWEAR RETAILER JJB blamed poor summer weather and disappointing sales of football shirts during the European Championship for a profit warning yesterday, which sent shares tumbling more than 24 per cent.
The company warned “sales have fallen materially short of expectations”, after consumer demand for replica football kit during Euro 2012 “did not materialise to the extent anticipated”.
Shares in other sports retailers such as JD Sports and Sports Direct also fell yesterday on fears that they will also have failed to shift sales of kit.
A JJB spokesperson put this down to “a general ambivalence towards the England team” and how it would perform during the championship.
Like-for-like sales declined eight per cent in the 22 weeks to 1 July, a sharp slowdown compared to a 5.7 per cent fall in the first nine weeks of the year to 1 April.
JJB, which recently secured a £30m lifeline from US sportswear giant Dick’s Sporting Goods and shareholders to revamp its stores, said net debt stood at £15.4m.
Philip Dorgan, an analyst at Panmure Gordon, downgraded his pre-tax profit forecasts for the year from a £37m to a £48m loss. But he does not expect yesterday’s announcement to dampen JJB’s long term prospects.
“After the most recent fundraising, JJB now has the funds to achieve a much higher level of profitability, but it will take time to move into the black,” said Dorgan.
JJB also revealed that its chairman Mike McTighe will step down after 20 “intense” months in the job. He will be replaced on 1 September by US retail veteran Robert Corliss, president of menswear retailer Robert Talbott.