Third Quarter IMS

Kesa Electricals' Third Quarter Interim Management Statement

Kesa Electricals plc today announces an interim management statement for the period 1 November 2010 to 18 January 2011, based on unaudited management accounts.

·; Total revenue grew by 0.4 per cent, declining by 4.0 per cent on a like-for-like basis, reflecting difficult market conditions

·; Adverse weather conditions in our major markets had an estimated 2 per cent sales impact

·; Darty France and Other established businesses delivered a solid performance offset by softer trading at Comet and the Developing businesses

·; Web-generated sales increased by 11 per cent

·; Group gross margin rate for the period was in line with last year

·; New €455 million 5 year Revolving Credit Facility signed on improved terms

·; Adjusted profit before tax currently expected to be ahead of last year and towards the lower end of market expectations¹

Revenue growth as reported Revenue growth in local currency

in Euros (1.11.10 to 8.1.11) (1.11.10 to 8.1.11)

* BCC, Vanden Borre and Datart

**Darty Italy, Darty Turkey and Darty Spain

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

"Against a background of increased competitiveness, Darty France and the Other established businesses delivered a robust performance, offset by softer trading at Comet and the Developing businesses. The Group gross margin rate was in line with last year, and the benefit of our cross channel sales strategy was further demonstrated by the 11 per cent growth in web generated sales.

 "We remain confident in our strategy and committed to our plans to implement the Darty concept in all our markets and we have put in place a number of additional measures to improve revenue and reduce costs."

Trading

Total Group revenue rose by 0.4 per cent in Euros, but fell 1.6 per cent in local currency and by 4.0 per cent on a like-for-like basis, with gross margin remaining stable. Overall web-generated sales increased by over 11 per cent, representing nearly 11 per cent of total product sales in the period. The revenue performance reflected a combination of a competitive market environment, stronger comparatives and adverse weather in the UK, France, Netherlands and Belgium ahead of Christmas. The weather conditions are estimated to have had an overall adverse impact on sales of at least 2 per cent.

In this environment Darty France, in spite of strong comparatives, delivered a solid performance. Revenue increased by 0.4 per cent in local currency, falling by 1.8 per cent on a like-for-like basis. Web-generated sales continued to grow strongly, by 18 per cent, and now represent nearly 10 per cent of total product sales. Gross margin saw an improvement following a strong performance in small domestic appliances and a growing contribution from the Darty Box. The French sales period did not start until 12 January and trading so far has been encouraging.

Comet delivered record trading from Boxing Day through to the New Year weekend, but this strong performance failed to offset the weaker sales seen early in December due to competitive trading and adverse weather conditions. Overall revenue for the period declined by 6.5 per cent in local currency and by 7.3 per cent on a like-for-like basis. Gross margin declined by c.140bps reflecting the highly promotional nature of the market over the period. Web-generated sales grew by only 3 per cent, reflecting some disruption during the introduction of the new software platform in November. Since the introduction of the VAT increase on 4 January we have so far seen sales trends soften. In the light of these factors we are now anticipating that Comet will deliver a small retail loss for the year.

Overall the Other established businesses, BCC, Vanden Borre and Datart, had a solid peak season and Vanden Borre delivered a particularly strong like-for-like performance. Revenue fell by only 0.3 per cent in local currency and by 0.4 per cent on a like-for-like basis and gross margin improved in the period. Web-generated sales increased by 28 per cent, representing nearly 11 per cent of total product sales. BCC continues to operate in difficult market conditions and is in the process of reshaping its commercial policy and cost base.

In line with our strategy we continued to grow overall market share at the Developing businesses with revenue up 10.4 per cent in local currency. Against strong comparatives in all our markets, sales declined by 8.8 per cent on a like-for-like basis, reflecting in part difficult market conditions and the short term impact of the rebranding to Darty in Spain.

Refinancing

Kesa Electricals plc has signed a committed €455 million five year revolving credit facility, replacing the Group's existing €500 million facility.

The new facility is expected to reduce the interest charge for the current financial year by around €0.5m and by around €3.0m in subsequent years. There will be an exceptional write-off of the unamortised fees for the previous facility of €4.8m this financial year.

Outlook

We remain confident in our strategy and committed to our plans to implement the Darty concept in all our markets. We have put in place a number of additional measures to improve revenue and reduce costs.

While trading at Darty France remains robust, given the current trading in the UK and the Developing businesses we currently expect adjusted profit before tax for the current year to be ahead of last year and towards the lower end of market expectations.

Financial position

No material events or transactions impacting the Group's financial position have taken place since the previously announced 31 October 2010 balance sheet date, save for the information provided in this statement.

Notes

¹The range of current market expectations for the Group adjusted profit before tax for the financial year ended 30 April 2011 is €98 to €119 million.

(Source: Kesa Electricals)

ENDS

There will be a telephone conference call for analysts at 07:45 on 19 January 2011. Participants' dial-in number +44 (0) 20 3003 2666 (No PIN required). If you would like to listen to a recording of this call, please visit the company's website www.kesaelectricals.com after 10.00am.

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 +44 (0) 20 7251 3801