Blacks Leisure Group plc
("Blacks Leisure" or the "Group")
Trading Update
At its Annual General Meeting to be held later today, Blacks Leisure, the UK's leading retailer of outdoor clothing, footwear and equipment, will provide the following update on its performance for the financial year to date.
Trading
In the 17 weeks to the end of our June reporting period, Group sales were £53.9 million compared to £76.9 million for the same period last year (which includes sales from discontinued activities and closed stores). This reduction is primarily as a result of the 107 stores closed in the restructuring programme last year.
Notwithstanding this reduction in sales, the Group has been able to increase its gross margin by 1.1 percentage points over the comparative period last year.
Like-for-like sales for the 17 week period were 7.5% below last year. Although the overall like-for-like sales performance during this trading period is disappointing, the shortfall arose primarily in May when trading conditions were particularly difficult. In the other months of this financial year to date, sales from the ongoing estate were broadly in line with expectations.
New store openings
Following the successful placing and open offer in March, which raised net proceeds of £19.7 million, the Group has been able to cancel the more expensive £7.5 million top-up element of its bank facility. The continuing core bank facility is £35 million. During the period under review, the Group has paid £7.1 million into the CVA fund to finance the compensation payments to landlords that were compromised as part of the CVA process implemented in December last year.
The Group has made very good progress with the new store opening programme announced at the time of the placing and open offer. It has thus far opened 7 stores (in York, Chester, Stratford upon Avon, Cheltenham, Cambridge, London Regent Street and Belfast, all within the Blacks fascia) and has a pipeline of an additional 8 planned stores between now and the end of the current financial year.
The performance of these new stores is very encouraging with sales per square foot being on average 39% above the rest of the ongoing estate. The Board is satisfied with the performance of these new stores.
Non-Executive Directors
The Board is pleased to announce that Tom Knight will be appointed a Non-Executive Director of Blacks Leisure with effect from 1 August 2010. Tom is a former Executive Director of Blacks Leisure, having worked for the Group from 1987 to 2002. Tom subsequently joined JJB Sports plc as Chief Executive from 2002 to 2007. He was also a non-executive director of Ultimate Leisure plc until 2006. There are no additional details relating Mr Knight's appointment that are required to be disclosed pursuant to paragraph 9.6.13 of the Listing Rules.
The Board intends to recruit a further additional Non-Executive Director in due course.
Outlook
Despite the adverse trading conditions in May the Board is encouraged by the progress on the new store programme and confident that the plans for the critical winter trading period are well advanced. These include a number of initiatives such as the launch of a customer loyalty card, a significant store training programme and a range of new branded lines which will be exclusive to Blacks.
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Enquiries:
Blacks Leisure Group plc 01604 597222
Neil Gillis, Chief Executive
Citigate Dewe Rogerson 020 7638 9571
Kevin Smith
Singer Capital Markets Limited 020 3205 7500
Jeff Keating
Forward looking statements
Information in this announcement is based upon unaudited management accounts and in addition, certain statements made are forward looking statements. Such statements are based on current expectations at the date of this announcement and are subject to a number of risks and uncertainties that could cause actual events or results to differ materially from any expected future events or results referred to in these forward looking statements. We undertake no obligation to update or revise any forward looking statements to reflect any change in our expectations or any change in events, conditions or circumstances.