Home Retail has good H1 but says Christmas is key

11th Sep 2014 07:49

Argos and Homebase owner Home Retail reported a good first half but warned that annual results would depend on Christmas.Home Retail said catalogue retailer Argos increased like-for-like sales for the ninth quarter in a row in the second quarter.Total sales at Argos, which expanded its shop numbers by 13 to 747 in the quarter, rose 1.4% to £901m and like-for-like sales increased 1.2%.Increased sales of electrical products as a whole, principally as a result of strong sales performances in TVs, video gaming and white goods, drove the rise, partially offset by a further decline in tablet computers. The increase more than offset small sales falls in furniture, homeware and jewellery. Gross margins at Argos were unchanged as a rise in the second quarter cancelled out a fall in the first.Homebase total sales fell 2.8% to £390m due mainly to six store closures in the quarter, resulting in seven closures in the first half, reducing the number of shops to 316.Like-for-like sales increased by 0.1%. Growth in sales of big ticket products was offset by lower sales of seasonal products following a strong performance in the latter in the same period last year. Sales in other product areas were slightly up.Chief executive John Walden said: "At this halfway point of the financial year we expect to deliver full-year group benchmark profit in line with current market expectations. However, as always, the full-year outcome will depend upon Argos' Christmas trading."Shares fell 4.8p or 2.5% to 182.8p at 08:25 in London.