UK, JD Sports Reports Turn Around at Outdoor Banners

UK-based retailer JD Sports Fashion PLC said its Outdoor Division broke even in the six months ended Feb. 2 and that it expects the trend to continue in the current fiscal year.

Sales at the division, which operates 531 stores under the Blacks, Millets and Tiso banners, declined 14 percent, or £17 million, to £104.0 million during the full fiscal year. However, the division's operating losses - excluding exceptional items - declined to £8.8 million, compared with £14.9 million in fiscal 2013.

In the second half of the year, the division broke even; marking a big improvement from the £4.9 million loss in the same period of fiscal 2013.

“We made substantial operational changes during the year in our Blacks and Millets Outdoor business with the staged closure of the legacy offices and warehouse in Northampton and the relocation to the Group's main facilities,” JD Sports Executive Chairman Peter Cogdill wrote in his annual letter to shareholders.

“Whilst there was inevitably disruption from this process, the resulting integration into Group functions, easier access to senior management and the removal of the unsustainable property costs connected with the Northampton site have given the Blacks and Millets business a significantly better platform on which to develop.

Cowgill said he was encouraged by the second-half performance at Blacks and Millets and expected the turnaround to continue in the current fiscal year. JD Sports acquired the business at the British equivalent of a bankruptcy auction in 2012. Last year, JD Sports acquired 60 percent of Tiso, an iconic but money-losing outdoor specialty retailer in Scotland. At the end of fiscal 2014, JD Sports operated 76 Balcks, 80 Millets and 17 Tiso stores with a total of 532,000 square feet of space.

“Inevitably, improvements in financial performance lag operational changes but I am encouraged that the Blacks and Millets business achieved a significant improvement in the second half of the year and we expect continued progress in the new financial year,” Cogdill wrote to shareholders.

“The property portfolio for Outdoor continues to be developed. The recent acquisition of Tiso in Scotland (which also includes George Fisher in Keswick) has improved geographical coverage and increased our market share and brand access although it will not, as a business unit, enhance short term earnings. We believe over time these actions will again bring greater support to the Group from key suppliers.”

By press release


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