Kesa sees challenges ahead as World Cup drives higher sales

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Strong demand for TVs in the run up to the football World Cup boosted Kesa, the electricals retailer behind the Comet chain, which posted forecast-beating results yesterday.

In keeping with prevailing concerns about the strength of consumer spending, however, the company was cautious on the outlook, with the chief executive, Thierry Falque-Pierrotin, anticipating that Kesa's markets "will remain challenging for the remainder of this financial year".

Like-for-like revenues rose by 4.3 per cent in the three months to the end of July, against City forecasts of 2 per cent growth. Gross margins fell by 50 basis points, however, owing to the mix of products sold. Revenues at Comet, which saw the relocation of one store and the refitting of nine core stores during the quarter, rose in line with the group, up 4.3 per cent on a like-for-like basis, while the company's Darty France business saw a 5.1 per rise over the same period.

Internet demand was also higher, with Kesa seeing a 28 per cent rise in web-generated sales. The company, which is Europe's No. 3 electricals retailer, said it saw "strong double-digit increases in all markets", particularly Darty France, which saw a 43 per cent jump in web-generated sales. The internet now accounts for nearly 10 per cent for Kesa's total product sales.