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JJB Sports…
Based on FSP’s multi–layered approach* to identify retailers at risk, which includes early signs like key staff changes, management re-shuffles and departures, to medium term dangers like decreasing market share/profits and store closures and re-enforcing that with financial information like gross profit and cash flow in its simplest form provide the navigation tools for a business.
While the rival Sports Direct has continued to make progress, these warnings are clear and have been around for some time:
• £24.7m loan from Bank of Scotland,
• fall in revenue from on-going retail operations for the 52 weeks to 29 January 2012 by £78.7m (21.7%) compared to the previous accounting period as a result of store closures
• like-for-like decrease of 13.1%
• rapidly falling P2 score indicating Very Worrying financial health
And now, the news that chief executive Keith Jones is stepping down with immediate effect is the latest in a chronicle of incidents (read woes!).
Over several years JJB has had three fundraisings and avoided administration twice. We wonder if the new chairman, US retail veteran Robert Corliss, has a turnaround strategy?
Key
P2>175 – Very Strong
P2 >150 and <175 - Healthy
P2>125 and <150 – Fairly Healthy
P2>100 and <125 – Head Above Water
P2<100 – Very Worrying
*As the performance of any business varies because of its size and sector, the FSP Retailer Risk prediction methodology can only be used as a rough guide to retailers in trouble. Financial Health is one guide in Retailer Risk
Elsewhere on the high street, Clinton Cards administrators have announced all remaining stores are to close by the end of the month, the government has announced a further 15 town centres that have been accepted into the Portas Pilots scheme, Max Studio have signed up to London Designer Outlet at Wembley, Vivienne Westwood is to open a store in St. Davids Shopping Centre, Cardiff, Juicy Couture has opened its new flagship store on London's Regents Street and is replacing its store on Bruton Street.
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