JD Sports boss: rent talks with landlords 'like wading through mud'

The boss of JD Sports today hit out at landlords who refuse to negotiate on rents and warned of potential store closures.

The athleisurewear chain’s executive chairman Peter Cowgill said building owners weren’t acknowledging a shift in consumer spending from stores to online.

He said of negotiations: “We are knee deep in mud. Some people say it’s like wading through treacle but it’s thicker than that. It’s amazing that there has not been a recognition of the channel shifts that are occurring.

“If rents are unacceptable there is only one outcome and that’s very negative there are using the short term protection of leases without recognising there is a serious long term shift.”

He said footfall in city centres remains low. "London is still pretty dead. Nowhere near where we were," Cowgill said. "What we have to remember is that London is the most expensive area. The rents are now completely unacceptable for the level of footfall that we are seeing. They are just out of context."

The company warned that a boost in store sales seen as shops reopened after lockdown was “short lived” and it is counting the cost of making shops safe.

The sportswear retailer said that pent up demand and sales of old stock initially aided revenues when shops were allowed to reopen, including on June 15 in England. This was particularly noticeably in countries where fewer people shopped online pre-Covid, it said.

But the company told investors: “However, that boost was generally short lived with footfall into physical retail continuing to be significantly weaker than historic levels in all of our geographies but particularly across Europe.

“Some of the weakness in footfall has been offset through better conversion and higher average transaction values as those consumers who visited physical retail did so with greater intent.”

Sales since reopening were still up 20% on last year, “heavily influenced” by strong growth in the US where government fiscal support has helped spending but is coming to an end.