International electricals giant DSGi is to slash the number of stores at its troubled Italian chain UniEuro by a third.

In its first big restructuring exercise launched by chief executive John Browett, who joined DSGi last December, approximately 40 UniEuro shops will be considered for closure in the next two years.

The initiative comes a fortnight before Browett is scheduled to unveil initial findings of his strategic review of DSGi, which last month posted its second profit warning this year.

Like-for-like sales at 116-store chain UniEuro plunged 14 per cent in the 25 weeks to April 5 and the chain has consistently underperformed.

DSGi has informed staff at affected UniEuro shops and said it is “working with the unions to review each shop on a case-by-case basis”.

DSGi bought UniEuro in 2001. Last year, the Italian chain generated sales of£621.4 million.

Analysts believe DSGi may also have to take the axe to its store portfolio elsewhere – including the UK – as it battles to resist the incursion of e-tailers and grocers into its markets.

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