Catalogue retailer Argos today posted its fourth consecutive quarter of sales growth, driven by buoyant demand for tablets and televisions.
Owner Home Retail Group’s DIY chain Homebase also moved into positive territory for the first time in two years, although the recent volatile weather hit sales of barbecues, outdoor furniture and plants.
The group’s profits have been declining for five years but the recent uptick in the performance of Argos, which is nearly twice the size of Homebase, has lifted its stock by 7 per cent this year.
Positive sentiment was in short supply today, however, after both chains registered lower margins, sending the shares tumbling by 9p to 135.1p. Argos revenue grew 1.2 per cent to £828 million in the 13 weeks to June 1 and like-for-like sales were up by 1.9 per cent.
Home Retail chief executive Terry Duddy said Apple’s iPad was the biggest-selling tablet but also hailed sales growth on devices from Samsung, Google and the retailer’s CnM brand. The higher volumes of less-profitable consumer electronics led to Argos’s margins falling by 0.75 per cent.
Homebase’s total revenue was flat at £422 million whereas underlying sales rose by 1.4 per cent. But margins fell by 2 per cent, which the group attributed to being up against an “unusually lower level” of promotions during the incessant rain last year. Duddy said the DIY chain had gained market share from rivals B&Q and Wickes, based on data from market researcher GfK.