Struggling Blacks' shares in a plummet after profit warning

The future of Blacks Leisure seemed in serious doubt today when the struggling retailer issued a profit warning that sent the already battered shares even further downwards.

In particular the company behind Millets said that trading conditions "have weakened in the last few weeks" leaving it "substantially dependent" on the Christmas period.

New chief executive Julia Reynolds has been brought into overhaul the retailer, while chairman Peter Williams deals with the banks. He says the Bank of Scotland, the main lender, remains supportive.

The shares fell 25% to 3p.

Kate Calvert at Seymour Pierce said: "A constructive dialogue has been maintained with its bank, according to management, but with net debt forecast at £32 million, we believe it will remain a challenge to come up with an acceptable solution for the company's long term future. We are maintaining our Sell recommendation."

Blacks is 21% owned by Sports Direct mogul Mike Ashley. He refused to take part in a money-raising rights issue last May.

Blacks reported a £16m loss last month for the half-year and was expected to make a full year loss of £23 million. It now looks like being a little worse than that.

The firm has seen several directors resign in 2011, including chief executive Neil Gillis in February, its chairman David Bernstein in August.