Electricals leader questions big-format stores
Dixons' sales suffered in the first half of the year to November, as the retailer closed 28 per cent of its floorspace. The retailer said it would continue to rationalise its estate by reducing the amount of selling space in Birmingham and Cardiff by 15,000 sq ft (1,395 sq m) in each city.

However, sales at Dixons Group for the 26 weeks to November 13 were encouraging, with an increase of 9 per cent, to£3.4 billion. Group like-for-like sales were up 5 per cent, with UK like-for-like sales up 6 per cent. Underlying profit before tax, including discontinued operations, goodwill amortisation and exceptional items, rose 15 per cent to£127.5 million. The group said it would continue to expand this year, creating more than 2,000 jobs.

Commenting on the group's UK performance, chief executive John Clare said: 'Like-for-like sales grew across all our businesses, despite the very competitive market conditions. Currys grew like-for-like sales by 9 per cent through driving higher footfall and conversion levels. PC World grew like-for-like sales by 3 per cent, a satisfactory performance in the light of the significant price deflation in both desktops and laptops. Dixons' like-for-like sales grew by 3 per cent, reversing the trend of recent years, largely because of the refitting of 100 stores and a new advertising campaign. The Link traded well, following the completion of the refit programme to the remaining 200 locations, with like-for-like sales up 8 per cent.'

Sales at Dixons stores reached£350 million, a fall of 12 per cent, which was blamed on store closures. The retailer said that its large format stores in Birmingham and Cardiff, both more than 25,000 sq ft (2,320 sq m), were too big. The trading space in these cities would be reduced to 10,000 sq ft (930 sq m), in line with a new store of similar size opened in Canterbury last year.

The retailer said that UK markets had remained flat over the period in terms of value. The brown goods market grew by 3 per cent, as sales of plasma and LCD TVs, digital cameras and portable digital audio products such as iPods grew. This growth was offset by the decline in demand for VCRs, domestic audio equipment and 35mm cameras. White goods sales were still strong, growing in value by 7 per cent. The computing market fell in value by 7 per cent, while unit sales rose 9 per cent. The mobile phone market performed best, with value growth of 28 per cent.