10th Mar 2016 07:34
LONDON (Alliance News) - Home Retail Group PLC on Thursday affirmed its profit expectations for its full financial year as like-for-like sales in its Argos catalogue retail business declined, though that decline slowed in the final weeks of the year.
Home Retail, which sold its Homebase DIY unit recently and which is subject to competing bids from UK grocer J Sainsbury PLC and South African retail group Steinhoff International Holdings NV, said like-for-like sales at Argos fell 1.1% year-on-year in the eight weeks to February 27.
The final eight-week performance marked an improvement over the second half as a whole. Like-for-like sales were down 2.0% in the full second half and down 2.6% for the full year ended February 27.
Total sales for Argos rose 1.9% in the eight-week period year-on-year, up to GBP515.0 million, driven mainly by an increase in net new space, including its digital concessions and collection points.
Non-electrical sales grew in the period, driven by furniture and sporting goods, partially offset by a decline in jewellery sales.
Homebase, which Home Retail has sold to Australian conglomerate Wesfarmers Ltd, saw like-for-like sales grow 3.3% in the eight weeks, 4.5% in the entire second half and 5.2% in the full year.
The group provided no further detail on the competing offers made for the company by Sainsbury's and Steinhoff. Sainsbury's has until March 18 to make a firm offer for Home Retail or walk away.
The company affirmed its pretax profit should hit market expectations for the full year, but said its cash balance will be much stronger than anticipated, due to the proceeds from the Homebase sale.
By Sam Unsted; [email protected]; @SamUAtAlliance
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