Currys and PC World owner racks up £140m losses
Currys and PC World owner DSG International today racked up annual losses of £140.4 million as it warned markets were set to remain tough in the year ahead.
DSG's losses in the year to May 2 were driven by one-off items - mainly turnaround costs and the lower value of European businesses - but were less than the £184.1 million seen in the previous period.
Pre-tax profits without the exceptional items showed a fall of 77 per cent to £50.5 million, reflecting a 9 per cent decline in like-for-like sales during a time of "significant change" for the company.
DSG has successfully completed a fundraising from shareholders and is "well prepared" for the tough conditions it anticipates in many of its markets for the next year. Chief executive John Browett added that the company had achieved rapid progress with its store refurbishment programme.
DSG said its UK and Ireland division had seen comparable sales fall 11 per cent in the year.
It said Currys had moved to cut the prices of its televisions in July last year to bring them in line with the internet. The chain also tried to slash its stock levels as a response to reduced customer demand.
Currys saw a "very tough" market in the crucial weeks before Christmas, but DSG said this was followed by a better-than-expected sales period.
The group sounded a positive note on recent trading saying that while white goods had suffered particularly as a result of the housing market downturn, sales had "shown signs of stability" towards the end of the year.
Sales of laptops and notebooks had also shown strong volume growth in the second half.
Meanwhile, like-for-like sales in UK computing were down 13 per cent across the year as weaker demand hit PC World.
The group said its TechGuys service desks were now in every store, providing expertise to customers and acting as a "valued differentiator" for the brand.
Mr Browett said: "We are improving the business for our customers.
"We are providing better service in store, selling complete solutions, delivering at more convenient times and improving our technical and after sales service.
"We are well positioned to emerge from the recession with a compelling offer for customers."
DSG's revamp programme has included 30 Currys Superstores, which have delivered gross profit uplifts of between 23 per cent and 65 per cent compared to rest of the chain.
This was "strongly ahead of management's expectations" and DSG said it plans to refurbish a further 58 Currys Superstores in the current financial year.
The group said it intended to open an additional 101 reformatted stores during the year in the UK, including four Currys Megastores.
The first Megastore was opened at Junction 9 in Birmingham in October and is, at 55,000 sq ft, the UK's largest electrical store.
DSG said it generated sales of £2.3 million on its opening weekend and is expected to generate approximately £30 million of sales per annum.
There are now two megastores in the UK after another opened in New Malden, London in June.
Mr Browett said: "This has been a year of significant change for the group."
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