Home Retail Group sees sharp drop in sales
Home Retail Group saw like-for-like sales at its Argos chain fall 8.5% in the eight weeks to 25 February due to the continued weakness in the consumer electronics market.
Total sales declined by 7.7% to £480 million.
Internet sales rose slightly on the previous year and now account for 40% of gross revenues, up from 36% a year ago. The retailer’s gross margins were flat.
Argos, which contributes 80% of Home Retail Group's overall sales, closed 12 stores during the period reducing the total to 748.
At Home Retail Group’s Homebase chain total sales fell 6.2% to £195 million. There was one store closure in the period leaving a total of 341. Like-for-like sales declined by 6.5%.
The group said it was on target to meet analysts' expectations for a full-year underlying profit of around £100 million, down from £254 million the year before.
Terry Duddy, chief executive of Home Retail Group, said: "With trends in this short, low volume, trading period being broadly as we anticipated, Group benchmark profit before tax for the 52-week period ended 25 February 2012 is expected to be in-line with current market expectations.
"Whilst we begin the new financial year in good operational shape, we will continue to manage robustly both the cost base and the cash position of the Group, while prioritising investment in the ongoing development of our multi-channel capabilities."
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