JJB Sports suffered a £42.9m pre-tax loss in its half year results, after admitting it was on the “brink of going into administration” earlier this year.

The loss at the sports retailer compares to a loss of £14.8m in the same period the previous year.

For the 26 weeks ending July 26, also reported revenue £178.6m, down 42.5% on the same period the previous year.

JJB Sports, along with rival Sports Direct, is being investigated by the Serious Fraud Office over a suspected sports retail cartel.

JJB chairman Sir David Jones said the directors “do not believe that the company has committed any offences under the Fraud Act for which it would be prosecuted given its leniency status and that otherwise the directors consider the company is the victim of certain other offences”.

He added that the Serious Fraud Office has confirmed that its investigation is focused on the activities of certain individuals rather than the company.

In the half year, JJB Sports disposed of its Fitness Clubs business to Dave Whelan, placed Original Shoe Company and Qube into administration, carried out a successful CVA, and arranged new financing with the Bank of Scotland.

Jones said: “What we have achieved to date and the volume of work which remains to be done is a reminder of the state of financial health in which the company found itself at the start of the year.

“Today’s announcement shows a marked decline in ongoing retail operations compared to the same period last year largely because of stock shortages in our stores during the period. We are confident that the actions we have taken during the period to restructure the business will allow us to move forward and rebuild our stock inventory by the first quarter of 2010. Although the retail environment remains challenging, we are encouraged by the early signs of improvement in like-for-like sales trends and gross margins in recent weeks.”

Sales for four weeks to August 23 were down 37% like for like while for the following four weeks were down 28%.

Jones said: “We remain extremely cautious about the remainder of the financial year. We are unlikely to see a significant improvement in stock levels or quality before the beginning of 2010 and it will not be until 2010/11 that we see any consequent improvement in JJB’s performance.”

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