New Evans Cycles owner Mike Ashley's warning that he could gut the company of half of its stores comes in spite of a report that suggests that almost all stores operate in profit.
In an administrators' proposal document released by The Telegraph over the weekend, major accountancy firm PricewaterhouseCoopers (PwC) came to the conclusion that 'almost all the stores were profitable' and that the company's overheads were created by fixed costs at its Sussex-based head office.
Last month, retail mogul Ashley threatened that he would have to close half of Evans Cycles's stores nationwide in order to save the business, founded in 1921, from administration.
This warning equated to around 30 stores with the risk of more than 400 redundancies.
At the time, Ashley commented that he was 'pleased to have rescued the Evans Cycles brand,' before adding, 'However, in order to save the business, we only believe we will be able to keep 50% of stores open in the future. Unfortunately, some stores will have to close.'
Evans Cycles completed its sale to Sports Direct last month, in which the budget sports store saw off competition from the likes of JD Sports and Halfords for the struggling high street chain.
When purchased, it was speculated that an injection of £20m would be needed from the prospective buyer in order to pull the company from administration.
The high street bike store became the latest piece in Ashley's growing business empire which includes shops Sports Direct and House of Fraser, and football club Newcastle United.
Ashley's purchase of House of Fraser was similar to that of the Evans sale, with the businessman spending £90 million in August to save the company from administration but threatening immediate store closures.
The billionaire's business method has been heavily scrutinised from all quarters during his notoriety with many criticising his reliance on zero-hour, minimum wage contracts as well as his reluctance to invest.