Argos Christmas sales hit by Black Friday
Home Retail Group said sales were broadly flat at Argos in the 18 weeks to 3 January as Black Friday had a significant impact on the pattern of trade.
While like-for-like sales edged up 0.1%, total sales grew by just 0.8% to £1,822 million in the period.
Although there was growth in sales of electrical products due to strong performances in video gaming, TVs and mobiles, the increases were offset by a decline in sales in the jewellery category.
Home Retail Group said the week of Black Friday was Argos’ highest sales week of the period, although sales were volatile in the weeks surrounding the event. The group’s chief executive John Walden said the event had “significantly impacted” the shape of Argos’ sales over its peak trading period.
He added: “In anticipation of volatility in trading patterns and the profit pressure caused by aggressive promotions, Argos pursued a more cautious trading stance over the period. This resulted in broadly flat like-for-like sales, but achieved both improved gross margins and good cost management.”
On Black Friday itself sales were up by 45% at Argos, while the number of visitors to its digital channels trebled year-on-year to 13.5 million. Mobile channels accounted for 71% of visits and 61% of digital sales.
Meanwhile, like-for-like sales at the Homebase DIY chain increased by 0.6% in the period. Total sales fell by 2.7% to £451 million primarily due to a reduction in net space of 3.3%.
Commenting on the group’s performance, Walden said: “I am pleased with our overall performance during our important peak trading period, having managed through a volatile trading environment with good control of both gross margin and costs.”
He added: “As a result of our trading strategy in the period, we continue to expect group benchmark profit before tax for the current FY15 financial year to be in line with the current market consensus.”
