Argos owner Home Retail reports boom in Summer goods
Home Retail Group, the company behind Argos and DIY chain Homebase, saw sales rise in the three months to August after a big boom in seasonal products like barbeques.
The news will be welcomed by shareholders, as profits at the retail company have been declining for the last five years and show little sign of turning around.
Argos took in £889 in the period, a rise of 2.7pc compared to the same period last year. Internet sales continued to grow - they now account for 44pc of total Argos sales, up from 42pc in the same period last year. Mobile commerce expanded particularly quickly, up 133pc in twelve months, accounting for 17pc of all sales. The company attributed this to investment in its mobile and tablet apps.
Argos also saw strong sales in seasonal products like barbeques which benefited from favourable weather conditions, as well as good performance from electrical products. However, furniture and homeware sales were down.
Subsidiary Homebase also performed well. Revenues grew 9.3pc year on year to £400m, a significant acceleration in the company’s rate of growth. Homebase’s sales were also boosted by seasonal products, which made up two fifths of total sales during the quarter. Big ticket, sizeable purchases were also up. Sales grew at a faster rate than
"The Group had a good first half driven by a positive sales performance in both businesses” said chief executive Terry Duddy, who announced he is to leave the company earlier this month. “Overall Homebase traded well through its peak period, while Argos continues to build on its digital leadership with mobile commerce now accounting for 17pc of Argos' total sales. At this stage of the financial year, we expect to deliver full year Group benchmark profit in line with current market expectations but, as always, the outcome will depend upon Argos' peak trading period.”
The company said it was approaching Christmas in good shape. “Whilst we continue to expect consumer spending to remain subdued, we approach the important Christmas trading period in good operational shape. We are on track to deliver the investment plans which will drive the long term development of both businesses" said Mr Duddy.