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Business News

Tablets and fridges help Argos to lift forecasts

Home Retail Group hailed storming sales of tablet devices and fridges at its Argos chain for driving an uplift in its annual profit forecasts.

The group, which also owns the DIY retailer Homebase, said the strong performance at the catalogue specialist means it has increased the cash on its balance sheet by £200m to £395m for the year just ended.

Terry Duddy, the chief execu–tive of Home Retail, said: "The main driver has been Argos's continued growth on the internet to 43 per cent of total sales from 40 per cent a year ago."

In addition to strong demand for tablets, Argos has grown sales of white goods, such as fridges and freezers, by increasing their distribution for collection in stores for online orders.

Argos's underlying sales rose by 5.2 per cent over the eight weeks to 2 March, although its performance was helped by the demise of rival Comet last year. This improvement enabled HRG to boast higher than expected profits of about £90m for the year.

Underlying sales declined by 1.5 per cent at Homebase but Mr Duddy said it had increased market share for 16 consecutive quarters.

Shares in Home Retail surged 16p, or 12 per cent, to 148.9p, their highest since the July 2011.

There has been speculation that Mr Duddy, who has led Home Retail since 2006, could step aside this year to let the new managing director of Argos, John Walden, lead the group. But Mr Duddy said: "I have no plans whatsoever [to quit] … I am here to get John started on this transformation plan at Argos."