Argos sees first sales rise in five years
In the 52 weeks to 2 March 2013, Argos’ like-for-like sales grew by 2.1% compared to a fall of 8.9% in the previous year. The growth was driven by the retailer’s multi-channel performance with sales growth in a number of categories, especially consumer electronics. Benchmark operating profit rose to £100.3 million from £94.2 million in the previous year
Argos’ multi-channel sales penetration increased to 51% of total sales in the year while internet sales grew by 10% to reach 42% of total sales. Website and app visits climbed 24% with mobile shopping now representing 10% of the retailer’s total sales.
Meanwhile, like-for-like sales fell by 4.9% at Home Retail Group’s Homebase DIY chain as adverse weather conditions and a “difficult market” hurt sales of seasonal items and big ticket categories. Operating profits at the 336-store chain more than halved to £11 million.
Home Retail Group launched a five year transformation plan in October 2012 to reinvent Argos as a digital retail leader, underpinned by a three-year investment programme to reposition it from a catalogue-led to a digitally-led business.
Homebase is also working to boost its multi-channel offer while developing a more female-friendly proposition both in-store and online.
The results meant that Home Retail Group’s benchmark profit before tax dropped by 10% to £91 million in the year while group sales were flat at £5.48 billion.
Both Argos and Homebase increased their market share during the year.
Terry Duddy, Home Retail Group chief executive, said: "This was an encouraging year with both businesses growing their market shares. Argos delivered like-for-like sales growth for the first time in five years and multi-channel sales broke through the 50% threshold. Our strong financial position enables Argos to deliver on its transformation plan to become a digital retail leader, and for Homebase to invest in the rollout of its new proposition."
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