SPORTS retailer JJB could be a victim of its own success in its quest to offload old stock.
The Wigan-based chain is in the midst of a summer sale to clear old lines before new product comes in as part of its turnround plan, after a deal with its landlords and the sale of its fitness centres.
Matthew McEachran, from stockbroker Singer Capital Markets, said he was surprised at the lack of stock on promotion during a site visit this week.
He said this could reflect successful clearance in the preceding 10 days, but added: “This creates a new problem, as JJB will need to put together a new in-fill package between now and the autumn when the first shipment of new ranges is scheduled to arrive.
“This will require the support of the branded suppliers and will probably not be part of the new targeted proposition. We expect the sales line to remain under pressure in the short term.”
JJB’s share price fell after reports it was considering a £50m rights issue, and that chairman Sir David Jones had borrowed £1m from Mike Ashley of rival chain Sports Direct.
JJB claimed Sir David had taken the loan for an investment in private company Advanced Network Technologies before joining the group, and that the JJB board was fully aware of the deal and so considers the matter closed.
