JD Sports Reports Strong Christmas Sales Following Failure Of JJB In 2012

Sportswear retailer JD Sports has reported like-for-like sales for the seven-week period ending 5 January were up 3.2%.

Peter Cowgill, executive chairman, said in a statement that multi channel development and its international sales had performed well and were expected to provide further opportunities in 2013.

In 2012, JD Sports brought Blacks and Millets out of administration, and struggled to produce any positive returns for its outdoor range, a problem Cowgill put down to the previous management team.

"All the key players in that team have been replaced very recently. However, due to purchase order lead times, there will be some delay before the full benefits of this will be realised," he said.

"Christmas 2012 has seen another very robust performance from our core Sports Fascias... while the performance of Outdoor has been disappointing, we remain confident that this business will produce future returns. Trading in recent weeks has been the strongest we have seen for some time."

JD Sports currently has 176 stores still in the portfolio; seven full store refurbishments were carried out in 2012 and the store size and locations will continue to be "optimised as performance is monitored and lease negotiations progress" - which suggests the number of stores will be reduced in poorly performing areas.

"Next year will also see the benefit of cost reductions in various areas of the business and we anticipate that losses will reduce substantially as the new year progresses," Cowgill added.

Nick Hood, business analyst at Company Watch, told Huff Post UK the disappearance of JJB, one of its major competitors, just before Christmas would have helped JD Sports' core business.

"However, assimilating the Blacks Leisure business it bought out of administration last year continues to occupy the management team and hold back overall performance, despite positive noises about recent trading in the Outdoor division. As with the whole retail sector, the real question will be how discounts and promotions have affected bottom line profits," he said.

"Its modest profits levels are combining with working capital pressures to produce a below par financial health profile, with a score of only 37 out of 100, so there is work ahead for JD Sports to boost their resources back to more acceptable levels."