JJB hit by 'retail recession'

Tough High Street conditions mean JJB is cautious about the future

JJB Sports has slumped to a loss blaming the "worst retail recession" it has ever known.

The retailer and health clubs group posted a £9.7m ($18m) loss for the six months to the end of July against an£8.3m profit at the same time in 2007.

The loss came as sales fell 5.6% to £344.7m at JJB. Two newly acquired businesses also made losses.

Looking ahead, the group said it remained very cautious about the future amid the current consumer slowdown.

"My non-executive board colleague David Jones formerly Chairman and CEO of Next Plc has described the current climate as 'the worst retail recession I have ever known'," chaiman Roger Lane-Smith said.

"I can only say that David's statement is borne out by our trading results as reported today."

Over the first half of the year the Wigan-based group has closed 96 stores and axed 700 jobs as it battles the current slowdown on the High Street.

The shake-up and introduction of more own-brands helped gross margin - a measure of profitability - at JJB's retail division improve from 50.8% last year to 51.7% this year.

"Looking ahead we remain very cautious about the outlook for retail given the background of a weakening consumer economy," Mr Lane-Smith added.

But chief executive Chris Ronnie insisted that management would stay "calm and focused" over the rest of this financial year.