GUS hit by slowdown at Experian and Argos

Click to follow

GUS, the group set to split into two FTSE 100 companies next month, revealed a slowdown in growth at its Experian credit information business and Argos retail chain yesterday. However, the Homebase DIY retail arm has enjoyed an easing in its sales decline.

The company, which said in July it had rejected bid approaches for the retail and credit units, also set a price range of 475p to 610p a share for the £800m fund-raising that its Experian credit-checking business will undertake on demerger, which some analysts said was lower than expected. It put a valuation of between £4.1bn and £5.3bn on Experian. Sales at Experian in the five-month period were up 7 per cent compared with an 8 per cent rise seen in the first quarter.

"It [the price range] is a little disappointing and the outlook statement for UK retail is cautious," Nick Bubb, an analyst at Evolution Securities, said.

The retail interests are to be known as the Home Retail Group after the demerger, it was announced. At Argos, underlying sales increased by 5 per cent for the five months to the end of August. The first three months of the period had enjoyed a 7 per cent gain but the last two saw sales growth slow to 2 per cent.

In the five-month period, which included the World Cup, there was a near doubling in sales of flat-screen televisions and strong demand for children's car seats before new legislation on car safety is introduced.

At Homebase, there was a 3 per cent sales decline, with a 5 per cent fall in the first three months and a flat performance in the latter two months.