The company said it hoped to create a similar number of jobs next year. This year's expansion will cost more than pounds 100m and take Dixons' employee numbers to 23,000.
Reporting doubled annual profits of pounds 200m, Dixons said that its sales in the nine weeks since 3 May were 17 per cent ahead of the same period last year after stripping out new store openings. Dixons said sales had been strongest in higher ticket items such as large screen televisions, personal computers and larger domestic appliances. It credited building society windfalls from the Alliance & Leicester and Halifax flotations for a large part of the sales increase.
Jonathan Clare, Dixons' chief executive, said: "There is very clear evidence of a windfall effect. People are buying more expensive items. And we can time the impact to the day that the money arrives in people's accounts."
Robert Shrager, finance director, added: "People are treating themselves to one-off items of expenditure. If you try and book an exotic holiday at the moment you won't be able to. They will all be booked. But if you want to go to Benidorm, you will be OK. We are benefiting from the same trend."
However, the company cautioned that the current sales levels would not be continued over the whole year and denied that the economy was entering a period of 1980s-style over-heating. Mr Clare said: "We don't get the feeling we are in the midst of a runaway boom. It is a one-off." He said a quarter or half percentage point in interest rates would not damage Dixons' business. "We'd like to see sustainable long-term growth."
As the company's shares jumped 9 per cent to 536.5p on the news, Dixons said it was looking forward to product launches based on digital technology. With digital cameras and camcorders already in the shops, Mr Clare said the next year or so would see the introduction of digital televisions, video recorders and recordable compact discs. "It's very exciting," he said.
Mr Clare was speaking as Dixons reported pre-tax profits of pounds 200m, double the figure of the previous year, and an increase in total dividends from 8.75p to 10.5p for the year to 3 May. Retail operating profits increased by 38 per cent to pounds 172m, helped by good sales of PCs, photography equipment and mobile communications products. Personal computers and related products now account for 29 per cent of group sales, up from 23 per cent last year.
There was a pounds 9m charge in the accounts to cover the costs of the Millennium computer problem.
Dixons has re-launched its Mastercare warranty service as a service contract, rather than an insurance policy to mitigate the effect of the insurance premium tax introduced in Kenneth Clarke's last Budget. The company said the move had reduced the impact on its profits from around pounds 30m to less than pounds 10m.
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