Repairing battered JJB could take up to five years

The company also warned that it could take five years to fix the business.

JJB Sports said trading in the first quarter of its new financial year met its expectations and it planned to revamp 150 stores over the course of the year, following a big rise in profit and sales at pilot outlets.

However, it said a full recovery would take three to five years in a tough business environment, with consumer spending under pressure from rising prices and austerity measures.

The company said: “The restructuring of JJB will not be easy or quick. The retail environment is challenging, will remain so for some time and we face intense competition.”

The loss made by JJB, which competes with larger rival Sports Direct as well as grocers and online retailers, in part reflected poor stock packages available to the company as it struggled for survival.

It made a loss of £68.6m in 2009/10.

JJB’s rescue deal with landlords in March was the second in two years, and allowed it to close weaker stores and cut rent payments on some others.

Without the deal, it would have fallen into administration and creditors would have lost more money.

JJB, which has raised £96.5m to fund its turnaround plan, said sales at six revamped stores were 16 per cent above the group average, with gross profit up 30 percent.

The new stores have improved layout and labelling, and are targeting keen amateurs, recreational sports participants and sporting families.

JJB shares have lost about 90 per cent of their value over the past four years.

The company has 17 stores in Yorkshire and North Lincolnshire, including shops in Sheffield, Hull, York and Huddersfield.

Mike McTighe, the chairman of JJB Sports, said: “Since the period end, a great deal has taken place. We have delivered two further fundraisings and agreed a significant CVA with our landlords that gives the company a real chance of recovery.

“However, this is the beginning of the hard work and not the end.”

Mr McTighe said that the work undertaken over the past six months, together with the “crucial support” of stakeholders, had given JJB a chance to survive and prosper.

He added: “I look forward to working with our management team to make this happen.”

JJB was originally formed in 1971 to acquire the business of a single sports store in Wigan.

The original store was established by JJ Broughton in the early 1900s and was then bought by JJ Braddock and then JJ Bradburn. When businessman David Whelan bought the store from John Bradburn, he kept the JJB name.

The portfolio grew to 120 stores in 1994, at which point the company was floated on the London Stock Exchange.

In 1998 JJB Sports acquired the business of Sports Division, which made it the largest sports retailer in the UK.

Since 1998, the Sports Division business has been fully integrated within the JJB group.

JJB now operates in most of the major towns and cities throughout the UK.