Dixons profits feel chill from snow
Published 13/01/2011 | 11:11
The owner of Currys and PC World today warned annual profits were expected to be at the bottom end of forecasts after snow-hit sales fell 4pc in the UK and Ireland over the festive period.
Dixons Retail Group said the adverse weather wiped around 2pc off like-for-like sales in the 12 weeks to January 8, which left Christmas trading well below last season's 8pc like-for-like improvement.
Shares in Dixons dropped 9pc as the retailer said profits were now likely at the lower end of forecasts, at between £100m and £110m.
But Dixons said the UK had performed well despite the extreme weather.
John Browett, group chief executive of Dixons, said: "Peak trading has been solid in a tough market. The adverse weather conditions reduced footfall in the run up to Christmas Day.
"We saw strong trade in the post-Christmas sale as customers were keen to take advantage of our great deals on 3D TVs, Apple products, tablets and white goods ahead of the rise in VAT in the UK."
The firm, which has 650 shops in the UK and around 1,275 worldwide, revealed a far better performance in its Nordic business, with same store sales soaring 11pc.
But sales dropped 5pc across other international markets as economic woes in Greece and Spain impacted trading, leaving group like-for-like sales down 2pc.
Analysts at Investec Securities said the group-wide performance was better-than-feared given the tough comparatives last year.
They put faith in the company's transformation plan to revamp outlets and roll out large combined megastores. "We remain buyers, given the longer-term self-help programme and the technology cycle."