By Maximilian Clarke
Revenue as popular high street sports retailer, JJB Sports, has dropped 22% in the half year ending July 31 2011.
The news comes as the British Retail Consortium have observed the beginnings of a recession in consumer spending, as escalating unemployment and job insecurity has caused a tightening of household purse strings.
JJB share prices have dropped by 2.53 points, or some 18% on the news, whilst earnings per share plummeted 14p to a 22.7p loss. Total pre tax losses amounted to £66.5 million0 a record for the company, though JJB’s Chief Executive Officer remains optimistic about the losses, explaining that they follow a broader restructuring programme that has led to costly store closures:
"Despite the consumer environment being extremely challenging and expected to remain so for the foreseeable future, our re-sized store portfolio and other cost-saving initiatives have allowed us to manage the business and maintain tight financial controls,” said Keith Jones. “Our focus on people and processes is yielding early wins and with the continued hard work from colleagues across the Group, I remain confident of JJB's return to profitability and growth.
“Our turnaround plan is now firmly established in the business and good progress has been made in a number of key areas, however there is much still to do.
“Our results for the half year have been impacted by the closing of unprofitable stores and the sell-out of old and obsolete stock. Despite the tough trading climate, the business is in better shape than of late and has the opportunity to develop the JJB proposition into a truly authentic sports retailer over the next few years."
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