Blacks Leisure has announced that it will not sell its Freespirit boardswear business, the subject of a controversial row with tycoon Mike Ashley earlier this year.

In June, Sports Direct founder Ashley, who has a 29.4 per cent stake in Blacks, attempted to sack the entire board at the retailer in a row about the disposal of the Freespirit chain.

Ashley threatened to requisition an EGM of shareholders, fire the directors at Blacks, install his own management team and cancel any potential sale.

In Blacks’ interim results for the 26 weeks to September 1, chairman David Bernstein said: “Following the conclusion of a strategic review of Freespirit, the board believes it is in the best interest of our shareholders for the group to continue to trade and develop this exciting brand.”

He added that the retailer has continued to develop own-label ranges to drive higher-margin products at Freespirit.

Like-for-like sales for the first half of the year were up 3 per cent, with Millets recording positive like-for-like sales of 6.4 per cent and Blacks up 4.3 per cent. However, in the seven weeks since the end of the year, like-for-like growth slowed to 1.5 per cent.

The retailer reported a pre-tax loss of£600,000 during the first half, down from£100,000 in the same period last year. Total group sales increased 3.9 per cent to£146.8 million. Gross margin fell to 54.5 per cent, down from 55.9 per cent, negatively affected by aggressive stock clearance in March.

The retailer has acquired the Mambo trademark for Europe for£1 million.

Topics