Blacks Leisure is in talks to axe its O’Neill wholesale arm as like-for-likes at the boardsports division fell 16.1% for the 26 weeks to August 30.
There are no plans to close its 11 O’Neill standalone stores, but the outdoorwear group wants to end its UK licensing agreement with O’Neill Europe.
Chief executive Neil Gillis said: “We’re not wholesalers. It’s a completely different expertise. From a cash flow point of view it did not make good sense.”
Gillis said the group had received several expressions of interest for its boardwear division from private equity firms and trade players, after announcing it was reviewing all options.
Blacks will spend £2 million in the next financial year on rolling out its new look Blacks and Millets stores, which Gillis said have seen an average sales uplift of 10% following the revamps.
Pre-tax losses at Blacks Leisure more than doubled to £6.7 million for the 26 weeks to August 30. Sales over the period fell 9% to £133m.