End of Year Trading Statement

End of Year Trading Statement

Kesa Electricals plc today announces details of the trading period 9 January to 30 April for the financial year ended 30 April 2011, based on unaudited management accounts.

Operational Highlights

·; Strong performance and overall market share gains at Darty France and the Other established businesses

·; Continued difficult trading environment for Comet

·; Market share gains at the Developing businesses in difficult conditions particularly in Spain

·; Accelerating differentiation in all our markets through leveraging the Darty concept

·; Strong cost control measures in all countries with specific restructuring actions at Comet, BCC and Darty Spain

Trading Highlights

·; Total revenue in the period was flat, and fell by 3.1 per cent on a like-for-like basis, reflecting challenging market conditions

·; Significant increase in web-generated sales at Darty France and the Other established businesses

·; Adjusted profit before tax¹ expected to be in line with the average of current market expectations

Revenue growth as reported in Euros

Revenue growth in local currency Like-for-like

* BCC, Vanden Borre and Datart

** Darty Italy, Darty Turkey and Darty Spain

Commenting on the Group's performance, Chief Executive Thierry Falque-Pierrotin said,

"In market conditions that have remained challenging, we have demonstrated the strength of the Darty concept with strong performances and overall market share gains at Darty France and the Other established businesses together with the improvement of our positions in the Developing businesses. In the UK, market conditions remained particularly tough and we have accelerated our plans at Comet to reposition the business and reduce our cost base.

"Supported by improved market positions in most of our markets, further cost measures in all countries with specific restructuring at Comet, BCC and Darty Spain and the strength of our balance sheet, we are well prepared for the challenging markets we expect to face in the coming year."

Trading for the period 9 January - 30 April 2011

Total Group revenue rose by 0.3 per cent in euros and was flat in local currency. Overall revenue fell by 3.1 per cent on a like-for-like basis reflecting challenging market conditions, particularly in the UK and Spain. Group web generated sales increased by 9 per cent and represented over 11 per cent of total product sales during the period. Gross margin rate was stable compared to last year.

Darty France gained market share with total revenue increasing by 7.6 per cent in local currency and by 5.0 per cent on a like-for-like basis, partly benefiting from the digital switch over in the Greater Paris region. Web generated sales continued to deliver substantial growth of 17 per cent, supported by further development of the website as a specialist reference site. Web sales represented over 10 per cent of total product sales in the period.

Reflecting the difficult market conditions in the UK, particularly following the VAT increase, Comet's total revenue fell by 14.5 per cent in local currency and by 15.2 per cent on a like-for-like basis. Excluding the government sponsored multi-media initiative which started in Q4 last year, like-for-like sales fell 10.5 per cent. Despite an 8 per cent fall in web generated sales during the period, web penetration increased to over 15 percent of total product sales. After initial challenges following the launch of the new web platform further technical and commercial improvements are being made to the site to improve its functionality and offering to customers. The initiatives implemented throughout this year regarding small domestic appliances, accessories and core store refits all continued to deliver positive results during the period.

At our Other established businesses total revenue increased by 4.3 per cent in local currency and by 1.5 per cent on a like-for-like basis. In line with our strategy of increasing our online presence, web generated sales increased by over 43 per cent, representing 10 per cent of total product sales during the period. Vanden Borre in Belgium again traded very strongly ahead of its market and we have started to see market share gains at BCC as we roll out the Darty based commercial policy following the introduction of a new management team.

At our Developing businesses total revenue was up 0.2 per cent in local currency and fell by 14.9 per cent on a like-for-like basis against strong prior year comparatives and with particularly difficult market conditions in Spain. In Spain we have started more recently to see market share gains and with the Darty brand in place across our core network we are launching communication plans to increase brand awareness and support our differentiated customer proposition. In Italy we successfully completed the accelerated store opening programme and now have 29 stores at the end of the period.

Restructuring

In the current trading environment we are working on reducing our cost to serve in all our businesses focusing on building improved efficiency without impacting service to customers. In certain countries we are implementing these plans via restructuring programmes which will result in exceptional costs totalling €33 million (of which €26 million are cash costs) with expected annualised cost savings of €18 million.

·; In addition to the day to day management of its cost base, Comet is planning to consolidate its 14 regional service centres to two sites, to reduce the warehouse network from three to two as part of a recent retender of logistics services and has reduced head office head count. These measures whilst reducing costs by an expected £10 million on an annualised basis will also enhance customer service levels. An exceptional charge totalling £20 million will be taken, £18 million of which in the year just ended. There will be a £2 million cash cost in the year just ended and £11 million in 2011/12.

·; Under the leadership of a new management team at BCC in the Netherlands a number of measures are being taken to reduce costs by an annualised €4 million in parallel with reviewing and improving the commercial policy. An exceptional charge totalling €3 million will be taken in the year just ended. There will be a €1 million cash cost in the year just ended and €2 million in 2011/12.

·; In the light of the ongoing difficult market conditions in Spain the decision has been taken to close 6 stores that have not been rebranded to Darty and focus further on the regional strength of the store portfolio in Madrid and Galicia, delivering expected annual savings of €3 million. An exceptional charge totalling €8 million will be taken in the year just ended. There will be a €1 million cash cost in the year just ended and €4 million in 2011/12.

Taxation

Given the geographic mix of profits within the Group the effective tax rate² is expected to be 39 per cent for the financial year just ended.

ENDS

¹ Adjusted profit before tax excludes the share of joint venture and associates' interest and taxation, the effects of valuation gains and losses on options to acquire non-controlling interests, profit on disposal of business operations, exceptional costs, amortisation and impairment of acquisition related intangible assets and exceptional finance costs.

² Effective tax rate on profit before exceptional items and prior year adjustments, including the share of joint venture and associates' tax.

There will be a telephone conference call for analysts at 08:00 on 11 May 2011. If you would like to listen to a recording of this call, please visit the company's website www.kesaelectricals.com after 10:00.

The Group will announce its full year results on Wednesday 22 June 2011.

Enquiries

Analysts

Kesa Electricals plc

Simon Ward +44 (0) 20 7269 1400

Media

Simon Ward UK +44 (0) 20 7269 1400

Vinciane Beurlet France +33 (0) 1 43 18 52 00

Finsbury

Charles Watenphul UK +44 (0) 20 7251 3801