22nd Nov 2006 07:02
DSG International PLC22 November 2006 Wednesday 22 November 2006 DSG INTERNATIONAL PLC TRADING STATEMENT DSG international plc is today updating the market on trading for the 28 weeksended 11 November 2006. 28 Weeks ended 11 November 2006 Sales Total growth Like for like growth UK & Ireland Electricals +5% +5%Currys +4% +5%Currys excluding Dixons Tax Free +4% +6%Ireland +28% +14%Nordic - Elkjop +28% +11%Southern Europe +3% (5)%UniEuro (4)% (10)%Kotsovolos +19% +8%Central Europe - Electro World +43% n/a Electricals Division +10% +4% UK Computing - PC World +6% +3%International Computing - PC City +28% n/a Computing Division +8% +3% Total Group (including New Businesses Division) +14% +5% Like for like gross margins across the Group for the 28 week period to 11November 2006, were slightly lower than last year, impacted by the weakperformance in Italy. Excluding Italy, like for like gross margins across theGroup were in line with last year. Prior year comparatives under the above Group structure are included in theappendix to this announcement. NOTES: (1) Total sales for the Divisions and the Group are in Sterling and exclude discontinued operations. All other figures are in local currency.(2) Like for like sales in the UK exclude sales of customer support agreements.(3) Currys comprises Currys, Currys.digital and Dixons Tax Free.(4) UK Computing comprises PC World, PC World Business, Genesis Communications and The TechGuys. Like for like sales are for PC World stores only.(5) The numbers of PC City and Electro World stores trading are insufficient for a meaningful like for like comparison to be made.(6) New Businesses Division is not shown separately as the base for the prior year comparison is not meaningful. John Clare, Group Chief Executive, commented: "The Group continued to make good progress in the first half, with pleasingperformances in the UK, Nordics, Ireland, Greece, Spain and our expandingCentral European business. Total Group sales grew by 14% in the first half. Consumer electricals markets across Europe continue to be driven by sales offlat panel, high definition televisions and strong sales of laptop computers.We continue to experience significant growth in our multi-channel and pure playe-tailing operations, including a first time contribution from Pixmania. However, the performance in Italy was very disappointing. The recentlystrengthened management team in Italy is implementing a plan to recover ourposition, having made significant changes to internal structures and processesin recent months. With the important Christmas peak season ahead of us, it is too early toextrapolate trends for the year as a whole. However, the Group is wellprepared, and is once again looking forward to the competitive challenges andopportunities that are always a feature of this time of the year. It alreadyseems certain that products like high definition televisions, i-Pods, laptops,MP3 players, digital cameras and satellite navigation equipment will be popularwith our customers throughout Europe over Christmas. We are confident that we are well placed to deliver growth over this importanttime of the year." Group trading Total Group sales were up 14% and like for like sales were up 5%. All of the Group's established businesses, with the exception of Italy, havedelivered a strong performance in the first half and are expected to show growthin profits relative to the first half last year. It is expected that underlyingtotal net finance income will be approximately £12 million in the first half.As a result underlying Group pre tax profits in the first half are expected tobe broadly in line with those in the first half of last year. Divisional trading Electricals Division Total sales in the Electricals Division were up 10% and like for like sales wereup 4%. In the UK and Ireland electricals operations, total sales were up 5% and likefor like sales were up 5%. Currys (including Currys.digital) performed wellwith like for like sales up 6%, benefiting from strong sales of flat paneltelevisions and laptops. Currys successfully introduced a multi-channel reserveand collect proposition for our customers in September. The recently converted Currys.digital stores are performing in line withexpectations and new categories such as small domestic appliances and whitegoods are being introduced into these stores. The disruption at UK airports during the summer impacted sales at Dixons TaxFree. Ireland performed strongly with total sales up 28% and like for like sales up14% as it continued to expand its store base. In the Nordics, Elkjop's total sales grew by 28% and like for like sales were up11% as it continues to make good progress across all its markets. Elkjop sawstrong sales in white goods, digital technology, such as laptops, as well as inflat panel televisions. The recently announced acquisition of a 40% interest inF-Group in Denmark is expected to complete shortly. This acquisition togetherwith that of Markantalo in Finland will consolidate Elkjop's position as thenumber one specialist electrical retailer in all of its markets across theNordics. Elkjop also experienced strong growth in its internet sales as itexpanded its multi-channel offering to customers. In Southern Europe, Kotsovolos total sales were up 19% and like for like saleswere up 8% as it delivered another strong performance, despite new entrants tothe market. Reaching new record levels of total market share, Kotsovolos gainedin all its core product categories. The Group is particularly pleased with theperformance of Kotsovolos Megastores, a new big space execution introduced in2005. The performance of UniEuro in Italy was very disappointing with overall salesdown 4% and like for like sales down 10%. The backdrop of politicaluncertainty, proposed economic reforms and a subdued economy has reducedconsumer confidence and this has created a more price competitive market.UniEuro's three year restructuring programme, which includes the centralising ofbuying, stock management and logistics, continues to be progressed. However inrecent months, as new people and processes were bedded in, stock availabilitywas affected, impacting market share and gross margins in the first half. Therecently strengthened management team is now implementing a plan to recover theposition in Italy. Stock availability is improving, marketing investment isincreasing and a refurbishment programme of some 35 stores will be completedshortly. In Central Europe, Electro World continues to make good progress and grew totalsales by 43%. The Group continues to invest in line with plans with theaddition of 4 more stores during the first half. Computing Division Total sales in the computing division were up 8% and like for like sales were up3% in the first half driven by growing sales of hardware, particularly laptopcomputers. High levels of deflation in laptops were offset by volume growthwhilst deflation in desktop computers was at lower levels than previouslyexperienced. PC World delivered a good performance with total sales up 6% and like for likesales up 3%. It performed well during the important back to school period.Collect@store continues to grow and now accounts for three quarters of PCWorld's growing internet sales. Overall PC City grew total sales by 28%. PC City Spain performed particularlywell. Progress has been made with the major reorganisation of PC City France,although a focus on stock clearance ahead of peak season has impacted marginsduring the second quarter. The TechGuys, the UK's first national digital home support service launched inSeptember, has had an encouraging start. New Businesses Division Since becoming a pure online specialist electrical e-tailer, Dixons.co.uk hasgrown its sales by 190%. This has been driven by strong price propositions andthe introduction of new categories and products. Dixons.co.uk now offers awider range of products such as white goods, toys, fitness and games equipment.DVDs, CDs and books will be added in time for Christmas. In July the Group acquired a 76% interest in Fotovista the owner of Pixmania, aleading European electrical e-tailer operating in 26 countries. Pixmania hascontinued to grow sales strongly in line with expectations. Progress is beingmade with the plans to extend Pixmania's ranges as they begin to leverage offthe Group's infrastructure. A white goods range and an expanded range of flatpanel televisions are now offered to customers in the UK. The short termpriority is to deliver more of these products across a broader Europeanlandscape. The Group will announce interim results for the 28 weeks to 11 November 2006,together with an update on current trading, on 17 January 2007. - Ends - For further information David Lloyd-Seed Director of Investor Relations, DSGi 01727 205065 Hamish Thompson Director of Media Relations, DSGi 01727 203 195 / 07702 684290 Jonathon Brill Financial Dynamics 020 7269 7170 Information on DSG international plc is available at http://www.dsgiplc.com APPENDIX PRIOR YEAR COMPARATIVES Reproduced below are the total and like for like sales for the Group for the 28weeks to 12 November 2005 under the new divisional structure for comparativepurposes. 28 Weeks ended 12 November 2005 Sales Total growth Like for like growth UK & Ireland Electricals (3)% (2)%Currys (4)% (3)%Ireland +22% +6%Nordic - Elkjop +10% +5%Southern Europe +39% +6%UniEuro +10% +4%Kotsovolos n/a +10%Central Europe - Electro World 0% n/a Electricals Division +7% +0% UK Computing - PC World (2)% (8)%International Computing - PC City +31% n/a Computing Division +1% (7)% Total Group (including New Businesses Division) +6% (1)% NOTES: (1) Total sales for the Divisions and the Group are in Sterling. All other figures are in local currency.(2) The changes in Group sales exclude The Link operations that have been discontinued.(3) Like for like sales in the UK exclude sales of customer support agreements.(4) Currys comprises Currys, Currys.digital and Dixons Tax Free.(5) UK Computing comprises PC World, PC World Business and Genesis Communications. Like for like sales are for PC World stores only.(6) The numbers of PC City and Electro World stores trading are insufficient for a meaningful like for like comparison to be made.(7) New Businesses Division is not shown separately as the base for the prior year comparison is not meaningful. This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
DXNS.L