THE founder of JJB SPORTS fears his former high street sports chain is doomed.
Wigan Athletic owner Dave Whelan yesterday told Sun City: “I can’t see how
they’re going to survive.”
The City veteran was talking as JJB shares plunged 24 PER CENT to 3.3p
on a shock move by its US backers.
American sports chain DICK’S SPORTING GOODS wrote off the entire
value of its investment in the UK chain. Dick’s injected £20million just
five months ago.
Mr Whelan, 75 — who sold out of JJB in 2007 when battling ill health — said:
“When I see how badly JJB are doing and now it looks like Dick’s have
withdrawn any help, well, it just looks like JJB are going to go. I can’t
see how they are going to survive.”
He added: “It would be absolutely upsetting if they do go, but business is
business.
“When you lose money like that, you are going to pay the price.”
Mr Whelan ruled out a bid to save the business, saying he was “too old”. He
added that Dick’s had under-estimated how competitive UK retail really is.
The former footballer founded JJB in the Seventies and built it into Britain’s
biggest sports chain with 400 stores.
Today it has just 180 after two “life-saving” restructurings — in 2009 and
again last year. Last month JJB warned that it needed more cash after a dire
start to the summer.
Mr Whelan blamed “poor management” for the chain’s problems.
He added: “The last three or four years have been absolutely tough. But when I
sold out they were generating profits of £20million.
“They’ve had something like six CEO’s over the past three to four years and
it’s probably just mis-management if I’m being totally honest.”
A JJB spokesman last night said talks with investors were continuing.
£5billion bid ‘rail-y risky’
RAIL giant FIRSTGROUP was panned in the City yesterday after it grabbed
the West Coast mainline franchise for £5.5billion.
Shares slumped 6 per cent to 243.2p as analysts warned the company had
over-paid to land the 13-year contract.
Influential transport analyst Christian Wolmar told Sun City: “It’s a heroic
bid based on revenues going up 10.4 per cent a year, meaning it doubles in
seven to eight years. I’m at a loss to see how they can achieve that.”
Mr Wolmar said there was a real risk FirstGroup would end up handing back the
franchise early — like NATIONAL EXPRESS on the East Coast in
2009.
He said: “We’ve seen what’s happened on the East Coast mainline before and
it’s difficult to see how that won’t happen again here.” But FirstGroup boss
Tim O’Toole said the firm would be able to generate the money by 2026 by
luring more passengers onto trains.
He expects passenger numbers to double to 60 million.
He said: “There’s so much capacity on this line that you are not going to have
overcrowding for a long, long time.”
UK’s best beer sales..probably
CARLSBERG claims it’s picking up business in the UK — despite a
slowdown in the beer trade.
The Danish brewer, which recently launched a new cider, says sales between
January and June were the same as a year ago.
But this compares with a three per cent FALL across the beer market in
general — despite the Diamond Jubilee and Euro 2012.
Carlsberg said its share in the UK is up 0.7 per cent to 16 per cent. Group
profits dipped 14 per cent to £425million as poor weather hit sales across
the rest of Europe. Sales in Asia were up 14 per cent.
Chief exec Jorgen Buhl Rasmussen said: “Carlsberg achieved positive market
share growth in all three regions. It shows the recent years’ significant
efforts are paying off.”
Penny pinch for Wilkinson
PROFITS at self-styled value retailer WILKINSON have crashed as it
feels the squeeze from the pound shops.
The chain made just £22.7million in the year to February — down 63
PER CENT. Sales were flat at £1.56billion.
Wilkinson blamed bumper investment in new stores and IT for the profits fall.
But analysts said it was suffering as more shoppers go to rivals such as POUNDLAND,
99P STORES and HOME BARGAINS.
Bryan Roberts of consultants KANTAR said: “They all swim in the same
pond and the pound shops are opening a lot of space.
“At the same time Wilkinson has been taking itself more upmarket, just as
shoppers head in the opposite direction.”
Wilkinson admitted it had suffered from “fewer shopper visits”. But family
directors Karin Swann and Lisa Wilkinson said: “We have made great strides
this year to shape our future.”
Stuart Mitchell stood down as chief exec in June after six years in the role.
£42bn hit for Brazil
THE Brazilian economy is getting a £42BILLION booster to protect
it from the global slowdown.
The country’s president Dilma Rousseff yesterday unveiled the huge investment
package.
She plans to sell off the rights to operate 5,700km of roads and 5,000km of
railways to private companies. Brazil’s ports will also be upgraded — to
boost exports.
Political intelligence agency STRATFOR said: “With a government willing
to make politically difficult decisions, this downturn may end up being a
boon for Brazil.”
Hanging by thread
CASHMERE specialist DAWSON INTERNATIONAL has collapsed — leaving 180
jobs on the line.
Administrators at KPMG were appointed last night to the UK arm of the
140-year-old business — after it failed to strike a deal over its pension
deficit.
The Pension Protection Fund (PPF) has rejected three rescue plans from the
group.
Chief exec David Bolton said he that hoped the at-risk jobs could still be
saved.
He told Sun City: “I’d be very surprised if a buyer cannot be found.”
EDF in UK loss shock
FRENCH giant EDF ENERGY has lost more than £260million supplying gas
and electricity to UK homes in the past two years.
Figures submitted to Ofgem reveal the company’s “domestic” business in the UK
lost £124million in 2011.
This follows a £136million loss the previous year.
Figures seen by Sun City show EDF made £1.2billion from its power plants in
the UK last year.
– CAR dealer LOOKERS is defying the downturn after an 11 per
cent surge in sales of new motors since the start of the year. Half-year
profits rose 6.6 per cent to £24.1million. Chief exec Peter Jones said:
“It’s another strong performance.”