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Home Retail Group sales slip as margins come under pressure

Home Retail Group said today sales at Argos fell 5.2% to £889m and sales at Homebase fell 1.4% to £459m in the 13 weeks to 29 May

CITY & CORPORATE

Home Retail Group sales slip as margins come under pressure

During the period total sales at Argos declined by 5.2% to £889m. Net new space contributed 2.9%; two new stores opened in the quarter, taking the portfolio to 747, and three stores were relocated.

Like-for-like sales declined by 8.1% in the quarter. The video gaming market continued to be particularly weak and, against the strong gains made by Argos a year earlier, TV sales were also down. These two categories accounted for approximately two-thirds of the overall decline in total sales. Growth continued in personal computers, white goods and toys.

Growth from the internet remained strong, led by Check & Reserve; the internet represented 32% of Argos' sales, up from 28% a year earlier. The Argos application for Apple's iPhone and Touch devices launched in late May and achieved 250,000 downloads in the first week.

Homebase saw like-for-like sales fall by 1.4%, with total sales also slipping by the same percentage margin, to £459m.

‘Economic conditions remain both challenging and uncertain, with this quarter proving difficult in terms of consumers' willingness to spend,’ said chief executive Terry Duddy.

‘The comparable period last year also contained some strong sales growth and share gains in certain product categories, particularly in consumer electronics at Argos. For Homebase, this quarter represented a good outcome to its peak trading period.’

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