"The retail environment, particularly in clothing and footwear, continues to be very competitive and in order to meet this challenge, JJB has been operating a vigorous promotional campaign since October 2005," reports the store group.
For "vigorous promotional campaign", read "price slashing," as evidenced by the continuing statement:
"This has resulted in a more satisfactory level of revenue than had been achieved in the first half of the current accounting year, but at a materially lower gross margin."
JJB said its "Christmas/New Year sale" brought in "increased levels of revenue...compared to the same two weeks last year, more than compensated for the reduction in the gross margin suffered in those two weeks."
Revenue by product category during the 22 weeks ended 1 January 2006, when compared to the same period last year, showed slight increases in all categories with the exception of footwear which was 2.6 per cent lower; gross margins were lower in the clothing and footwear categories whilst margins in the other categories were similar to those achieved in the comparative period, said JJB.
There's a sting in the tail: "We currently expect pre-tax profits for the 52 weeks ending 29 January 2006, to be within the range of £32 million to £36 million, being lower than current market expectations."
Started from just one sports shop in Wigan in the 1970s, JJB now has 439 stores, including 193 out-of-town superstores.