Christmas sales bring cheer to DSG

Christmas sales bring cheer to DSG

	Published : Wed, 18 Jan 2006 15:15 By : Paula Demarzio Print this Story

LONDON: Britain's electrical retailer DSG International Plc. reversed a weakening sales trend and posted a 2 per cent increase in its like-for-like sales in the eight weeks ended 7 January.

Unitwise, like-for-like sales were up 8 per cent at the Dixons chain, up 3 per cent at Currys, up 3 per cent at PC World, but down 28 per cent at The Link, the troubled mobile phone chain, which is 40 per cent-owned by O2 Plc. Online sales went up by a phenomenal 47 per cent.

In the company's European businesses, like-for-like sales at Elkjop in Scandinavia and UniEuro in Italy went up 4 per cent and 9 per cent respectively, but at Kotsovolos in Greece it was down 5 per cent.

In Britain, retail total sales had gone up 3 per cent and like-for-likes 1 per cent. International retail total sales were up 11 per cent with like-for-likes up 4 per cent.

The company's overseas operations account for over a third of its business.

DSG's chief executive John Clare said the performance in encouraging, but cautioned against comparing Christmas trends to the rest of the year. "Clearly there is a glimmer of hope in the way we've seen consumers react over the last eight weeks," he added.

The company's first half like-for-like store sales were down 3 per cent and underlying pretax profit fell 20 per cent to 97.5 million pounds from 121.8 million the previous year. Gross margins across the group were in line with last year's.

Clare likened the situation to a 'digital Christmas' in the company's stores with gift items such as games consoles, satellite navigation equipment, iPODs and MP3 music players, flat panel televisions and laptops performing well. iPODs sold at the rate of one every three seconds, flat panel TV sales were up 90 per cent in value terms, satellite navigation equipment up 167 per cent and laptop computers up 40 per cent.

The company hopes to achieve 30-million-pound cost saving in the current fiscal, while the target for 2006-2007 is 20 million pounds. It plans to pay a first-half dividend of 1.92 per cent a share, a 5 per cent increase on last year's 1.83 pence.

DSG shares rose 3.5 per cent to 169-1/2 pence. The stock was the biggest gainer in the FTSE 100 index.