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Argos sales improve at year-end

Thursday March 10th 2016

Home Retail Group has said it continued to see an improved performance at its Argos chain in the final eight weeks of its financial year after trade was boosted by a new fast track delivery service.

The group, which sold its Homebase business recently and is being pursued by Sainsbury’s and South African retail group Steinhoff, said total sales at Argos increased by 1.9% to £515 million in the eight weeks to 27 February. Net new space contributed 3%, mainly as a result of the 94 digital concessions and collection points opened within the past year.

Like-for-like sales at Argos declined by 1.1% in the period. However, Home Retail Group said the cannibalisation impact on like-for-like sales as a result of the additional new space was around 1% and therefore underlying like-for-like sales were broadly flat. The store estate increased by a net 90 stores to 845 in the year.

Sales of non-electrical product categories increased with growth in the furniture and general sports categories partially offset by a decline in jewellery. Sales of electrical products fell during the period although mobiles continued to deliver good levels of growth.

Online sales at Argos climbed by 13% in the period and represented 51% of total sales. This compares to 46% in the same period last year. Within this, mobile commerce sales grew by 15% to represent 28% of total Argos sales, up from 25% in the prior year.

Looking at the full year, total sales growth at Argos was flat while like-for-like sales fell by 2.6%.

John Walden, chief executive of Home Retail Group, said: "I am pleased with the continued improvement in Argos' sales performance in the period, together with the continued progress in the Argos Transformation Plan to become a digital retail leader.

“In October we introduced FastTrack - market-leading propositions for same-day home delivery and store collection. Since its introduction, customer awareness of FastTrack has continued to grow and its operations are improving, with both on-time delivery rates and customer satisfaction now at leading levels.

“Along with FastTrack, the combination of our now proven digital concession model, together with improvements in digital experiences have driven increases in both digital sales and digital participation.”