• H1 pre-tax loss more than doubles to GBP16m
  • Like-for-like sales down 7.2% to GBP81.1m
  • New chief executive says turnaround potential “is clear”

Troubled retailer Blacks Leisure Group is poised to reveal a radical strategic rethink after first-half losses more than doubled.

The UK business described the six-month period to 27 August, in which like-for-like sales fell by more than 7%, as “extremely challenging”.

Gross margins slumped to 43.7% from 48.8% a year ago, thanks to the clearance of excess stocks and what Blacks called “a tough consumer environment”.

The retailer has initiated a comprehensive review of strategy and operations, following the arrival of Julia Reynolds as its new chief executive on 1 August.

It added that “detailed strategic plans” would soon be complete, focused on investing in the company’s existing stores, differentiating between the Millets and Blacks brands, and developing own-label products.

“Since August, we have addressed some critical retail issues facing the group, most notably realigning the stock position and strengthening the management team in key functions, while simultaneously implementing a thorough, root-and-branch review of the business,” said Reynolds.

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