JD Sports is expected to appoint administrators for its Go Outdoors brand within days, putting further high street jobs at risk during the Covid-19 pandemic.
More than 2,000 people are employed by the brand, which specialises in fishing, cycling and camping gear, and relies on its 67 stores for the bulk of its sales.
Retailers have been hard hit by the coronavirus lockdown, with all but essential shops unable to open for business until last Monday. Even those with successful online operations were forced to scale back to accommodate social distancing rules in their warehouses.
Go Outdoors closed all its stores during April but began to reopen them from early May. However, continued restrictions on outdoor activities and the closure of campsites are likely to have hit sales.
JD Sports filed a notice of intention to appoint administrators for the business on Friday. It is understood that accountancy firm Deloitte is likely to lead a restructuring of the company, which could involve job cuts across its 2,300-strong workforce.
Go Outdoors has been gauging the appetite for a potential sale in recent weeks. However, JD hopes to maintain control of a smaller Go Outdoors brand in any potential deal, according to Sky News, which first reported the story. JD Sports declined to comment.
The pending administration comes just four years after JD Sports paid £112m for the chain in November 2016, adding to its portfolio of companies, which include other outdoor leisure brands, including Blacks and Millets.
Go Outdoors is the latest retailer pushed to the brink during the coronavirus crisis.
A string of retailers including Oasis, Warehouse, Laura Ashley and Debenhams have also called in administrators since the crisis hit and hundreds of high street jobs have been shed.
In April, Cath Kidston made 900 people redundant when it closed all its 60 stores in the UK.
But Britain’s retailers were struggling before Covid-19 struck, with the potential death of the high street a key issue at the 2019 election after a wave of high-profile shop closures.
Go Outdoors, which accounts for around 5% of JD Sports’ annual turnover, was also struggling before the pandemic, and posted a loss of around £40m in the six months to August 2019.
According to the consultancy Retail Economics, pretax profit margins at the UK’s top 150 retailers have halved over the last decade, dented by the rising minimum wage and business rates.
JD Sports is expected to publish its full year results on 7 July.
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