Home Retail Group lifts profit guidance after sales rise at Argos
Home Retail Group has raised its full-year profit expectations following a 2.7% rise in like-for-like sales at its Argos stores over the peak Christmas trading period.
In the 18 weeks to 5 January 2013, total sales at Argos grew by 1.6%. The increase in like-for-like sales was driven by an improved performance from consumer electronics with strong growth in sales of tablet computers.
Growth in sales of white goods, toys and core electricals offset weaker trading in the homewares and jewellery categories. Online sales now account for 42% of total sales at Argos as the retailer looks to develop its multi-channel offer.
At the Hombase DIY chain, like-for-like sales declined by 3.9% driven by a continued weakness in big ticket sales. Total sales declined by 4.5% to £453 million.
Home Retail Group now expects benchmark profit before tax for this financial year to be around £10 million ahead of the current market consensus of £73 million.
Terry Duddy, chief executive of Home Retail Group, commented: “Argos had a good peak trading period building on its first half performance. Internet sales for the year to date now represent 42% of Argos’ total sales, within which mobile commerce sales grew by 125% as our customers took advantage of new tablet and smartphone apps and improved website functionality.
“Whilst we anticipate consumer confidence will remain subdued in the coming year, we are focused on delivering the transformation plan to reinvent Argos as a digital retail leader and the ongoing development of the Homebase proposition.”
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