Blacks Leisure is poised to undergo an equity fundraising of between £15m and £20m and has reported robust sales at Christmas.
Blacks said that like-for-like sales in the six weeks to January 7 were ahead 15.2%. The sportswear retailer attributed some of the uplift to the cold weather and added that since the implementation of its restructuring plan in September like-for-like sales have been ahead of last year.
In its last quarter, Blacks closed 87 loss-making stores and put its Sandcity business into administration and underwent a CVA. Excluding the stores it has closed, the group said like-for-like sales in the six month to January 7 grew 12%.
Total group sales for Blacks over the half dropped to £98.9m compared to £102m for the same period the year before, the fall largely as a result of the store closures and Sandcity administration.
Blacks said the fundraising would be used to refresh the group’s existing stores and selectively expand some of its fascias. Blacks has 313 stores, including 208 Millets stores and 92 Blacks stores in its outdoor division and 13 stores trading under the Freespitit fascia in its boardwear division. In the six-month trading period like-for-like sales increased 13.1% at the outdoor division and the boardwear division recorded a like-for-like drop of 4.4%.
Gross margins were “broadly in line” with those reported in the first half of the financial year, Blacks added.
Blacks chief executive Neil Gillis said: “I am pleased to announce that the group performed very strongly through its peak trading period, with a healthy and consistent recovery in like-for-like sales growth underlining both the fundamental strength of the group’s offering and the recovery potential of the core estate following the approval of the CVAs in late 2009.”
He added: “Following the restructuring measures taken in 2009, Blacks Leisure is now a significantly stronger business and is better placed than it has been for some years to build on this recovery.”