The Millets stores will see more own brands

The board of troubled outdoor retailer Blacks Leisure Group remains upbeat despite mounting losses and debt.

The company, which operates the Blacks and Millets stores across the UK, lost £16m in the first half of 2011, more than double the loss in the same period last year.

Blacks’ debts also rose due to what it called a disappointing trading performance, and directors admit the company will need further funding to implement its plans.

Former underwear retailer Figleaves.com boss Julia Reynolds, who stepped in as Blacks chief executive in August, said: “It is already apparent that there are multiple opportunities to bring fresh retail ideas and disciplines to the business and more properly exploit its market leadership position, brand heritage and unparalleled brand recognition in the outdoor retail space.

“Notwithstanding the challenges of a difficult economic environment, the potential opportunity for a turnaround is clear.”

The company said it wants to strengthen its online retailing operation and emphasise the difference in branding between its Millets and Blacks shops while increasing its own-brand gear to increase its profit margins.

It will not open any new stores but will concentrate on refurbishing its existing properties. Expect to see more own brands in Millets while Blacks continues to focus on more established brand names.

Like-for-like sales fell 7.2 per cent compared to 2010, with £81.1m taken in its stores and online operations. Gross margins fell from 48.8 per cent to 43.7 per cent, a result, the board said, of the necessity of clearing excess stock.

Peter Williams, who was confirmed as chairman, said: “Under new leadership and with a fresh strategy and significantly enhanced retail expertise, there is a real opportunity with the right funding structure for the business to re-establish its forward momentum.”