Kesa outshines DSG with sparkling festive sales

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The Independent Online

Kesa Electricals poured salt on DSG's wounds yesterday by revealing that its Comet chain had outperformed Currys over Christmas.

DSG's smaller rival said like-for-like sales in the 10 weeks to 8 January rose by 7.5 per cent at Comet. This compared with like-for-like sales growth of 1 per cent at Currys in the eight weeks to 6 January, although Comet's previous year comparisons were very weak.

Jean-Noel Labroue, Kesa's chief executive, said: "Sales remained robust over our peak pre- and post-Christmas trading period and all our businesses delivered good revenue performances."

Comet's sales growth in November contrasts with Currys, which had a very disappointing four weeks before a late surge lifted its underlying sales into positive territory. Analysts noted that on a two-year view, however, both chains have grown their underlying sales by a similar amount.

Group sales at Kesa, which owns France's biggest electricals chain, Darty, grew by 6.4 per cent on an underlying basis. Darty's like-for-like sales increased by 4.6 per cent, while sales at BUT, its French furniture chain, rose by 5 per cent on the same measure despite strong competition from Sweden's Ikea, which is growing fast in France.

The company said demand remained strong for flat-screen televisions, continuing a bumper period for new technologies. Multi-media products, including MP3 players, portable DVD players and satellite navigation kits, also sold well, as did laptops. However, the increasing proportion of sales from lower-margin goods meant the gross margin slipped by 100 basis points.

Comet benefited from the continued return to positive growth for white goods, which are an important part of its sales mix. The chain has sought to distance itself from the welter of competition at the bottom end of the electricals market, which is becoming increasingly crowded, by selling more expensive products than those found at the grocers.

Currys said it suffered from poor sales of the sorts of low-priced electrical goods popular with festive gift givers.

Christian Koefoed-Nielsen, retail analyst at Panmure Gordon, said the two chain's contrasting performances provided "an indication that DSG's electrical problems are largely self-inflicted".

Shares in Kesa, which had tumbled after DSG's disappointing trading update, rose 3p to 346p.

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