Home Retail chief executive Terry Duddy said Argos had been a winner in categories such as technology, as shoppers increasingly turned to the convenience of multichannel rather than making numerous shopping trips to specialist stores.
Sales through Argos’s Check & Reserve service increased nearly 50 per cent over Christmas as consumers increasingly took up the option. “It gave people the certainty that what they wanted would be there, rather than having to chase up and down the high street,” said Duddy.
On the Thursday before Christmas, 250,000 Check & Reserve orders were made and, over the festive period, internet sales rose by a third to 23 per cent of Argos’s total.
Like-for-likes edged down 0.2 per cent in the 18 weeks to January 5, but total sales increased 2.5 per cent to£1.92 billion.
Investec analyst David Jeary said: “The multichannel approach has worked well for Argos, with progress not appearing to be dented by Tesco Direct and John Lewis Direct, which also performed well over the period.”
However, Deutsche Bank noted: “As consumers become more experienced internet shoppers, there is a danger they will discover shopping search engines more and Argos’s high street pricing may look expensive relative to pure-play internet retailers.”
Duddy warned that the consumer slowdown is likely to last throughout 2008 and called for an interest rate cut. “It is obvious that sales growth in the short term will be harder to come by,” he said.
Nevertheless, he said profit for the full year was likely to be “towards the upper end of market forecasts”, in the region of£430 million.
Argos issued its latest catalogue on Saturday, reducing prices on reincluded lines by 4 per cent overall and “further enhancing excellent customer value”, said Duddy.
Sales at Home Retail’s Homebase chain fell 6.3 per cent like-for-like over Christmas.
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