JD Sports profits drop as Blacks and Millets struggle

http://www.bbc.co.uk/news/business-22186731

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JD Sports Fashion has announced a drop in profits following losses at its outdoor chains, Millets and Blacks.

For the year to 2 February, the retailer reported a 18.3% dip in pre-tax profits to £55.1m, down from £67.4m the year before.

Blacks and Millets contributed heavily to the drop, reporting an operating loss of £14.9m before exceptional items.

The company bought the outdoor stores from administrators in January 2012.

There was better news from the group's core sports stores, which saw revenues grow by 10.2% to £854m, with operating profits up 4.7% to £77.8m. But that was not enough to halt the overall drop.

The company remained positive that the outdoor brands would pick up. A new management team has been put in place and stock supply improvements, store makeovers and cost reductions are all underway.

"Although initial results have been more disappointing than originally anticipated we now have a firm foothold in a different and growing lifestyle market in the UK," said JD Sports executive chairman Peter Cowgill.

"We remain optimistic that these Outdoor fascias will prove to be a successful core retail operation."

The company added that the recent cold weather and a three-month clearance programme ending in March had already boosted like-for-like sales of outdoor goods for the current financial year.