Argos reports a good start to the year

Home Retail Group, the UK’s leading home and general merchandise retailer, today publishes an Interim Management Statement covering the 13 weeks from 3 March to 1 June 2013.

Terry Duddy, Chief Executive of Home Retail Group, commented:

“Argos has delivered a good start to the year driven by continued success in consumer electronics and electricals, supported by growing internet and mobile commerce sales. Overall, its trading has been consistent with our expectations. Homebase produced a positive like-for-like sales performance, however seasonal sales were adversely impacted by the volatile weather and as a result its performance for the quarter was slightly behind our expectations. Whilst we expect consumer spending to remain subdued, we are on track with delivering our investment plans to drive the long term development of both Argos and Homebase.”

Argos:
Total sales at Argos grew by 1.2% to £828m. Net closed space reduced sales by 0.7% in the quarter with the store portfolio remaining at 737.

Like-for-like sales increased by 1.9% in the quarter. Consumer electronics maintained its positive sales performance driven by growth in both tablets and TVs, which together with continued growth in both white goods and core electricals, more than offset the market driven declines in the video gaming and audio categories as well as the weaker performance in seasonal products.

Total internet sales grew in the quarter, resulting in internet penetration increasing to 42% of Argos’ total sales, up from 41% a year ago. This growth was supported by further strong growth in the mobile commerce channel in which sales increased by 114%.

The approximate 75 basis point gross margin decline was driven by the sales mix impact from the growth in consumer electronics.

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Source : Home Retail Group
www.homeretailgroup.com/media/159375/home_retail_group_q1_13-14_13-06-13.pdf