A later than usual catalogue launch and wintry weather contributed to a like-for-like sales fall of 9.4% at catalogue store group Argos but parent Home Retail Group expects its full-year results to beat expectations.
Argos’s total sales fell 6.6% TO £537m in the final eight weeks of the year to February 27. However, the retailer reported that the comparable-store figure took a 3% hit as a result of snowy conditions and the catalogue launch date shift, which happens once every five or six years. The snow led to the closure of some stores and lower footfall and transactions.
However stablemate home enhancement chain Homebase held its like-for-like decline to just 0.6% and total sales were £205m for the period. Homebase’s performance will help Home Retail deliver full-year benchmark pre-tax profit of about £290m , which is £5m ahead of the previous consensus figure.
The shortness of the reporting period, traditionally a low volume time, and the volatile conditions make it difficult to draw many conclusions from the performance but Home Retail chief executive Terry Duddy said the trading outlook remains uncertain.
He said: “This is a good outcome to a challenging year. For the new financial year, we continue to plan cautiously given the uncertain economic outlook but do so from our position of operational and financial strength.”
Shore Capital analyst Kate Calvert said: “Management had already warned to expect very weak fourth quarter sales because of the weather and catalogue timing differences and so today’s numbers should not surprise though Argos’s like-for-like sales number was worse than we were looking for and Homebase better.”
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