Dixons sales dip by 3 percent, company exudes cautious outlook |
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Thu, 08 Sep 2005 06:05
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LONDON - Britain's biggest electrical retailer, Dixons has exuded a cautious outlook after domestic sales of mobile phones and PCs dipped to a trickle over the summer.
The company reported a 3 percent dip in same-store sales in the first-quarter of the year, but shares held steady due to relief that the results had not been worse than this.
"We are pleased with the progress of our international operations, whilst we remain cautious about prospects in the UK, where we have experienced the slowdown in consumer expenditure," said John Clare, the Dixons chief executive. He added that this period was always pretty quite as far as sales were concerned and warned that it was too early to write off the company ahead of the crucial Christmas period when sales hit their peak.
The company's mobile phone retail business, The Link, was particularly affected as sales slumped by 28 percent amid growing competition in that segment. Same-store sales at PC World fell by 7 percent as the deflation in computer prices continued to wreck havoc at the retail markets. Currys, part of Dixons' electrical goods division witnessed a 4 percent decrease in sales. "We haven't seen any of our core markets showing any signs of improvement yet. But they haven't got substantially worse over the last three to four months. We will focus on driving sales growth as we approach our peak season, but we will underpin this with careful margin and cost management," Clare reiterated.
Dixons is changing its name to DSG International Plc later today at the shareholders' meeting. Shares of the group rose by 2.1 percent to 157.25 pence in early morning trading.
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