Currys’ revenues fell over the festive period, although the retailer’s UK and Ireland business delivered better-than-forecast results to offset issues internationally.
In a trading update for the 10 weeks to January 7, Currys reported a 6% fall in group revenues driven by a 5% slump in like-for-like revenues in the UK and Ireland and a 7% dip in international sales.
Despite this, Currys said its domestic business had performed better than expected over the peak trading period, delivering better-than-forecast profits due to gross margin increases and continued cost savings.
The retailer noted that stores outperformed online during the period, while the Currys service offerings such as installation, protection and recycling all grew.
Profits for the retailer’s Nordic business softened due to a slowdown in the market and ongoing margin pressure. Although sales in Greece were up 12% year on year over the 10-week peak period.
Currys said the “continued strengthening” of its UK and Republic of Ireland business meant “we remain confident of delivering adjusted PBT between £100-125m” despite the deteriorating state of its international arm.
Currys chief executive Alex Baldock said: “This peak has again shown Currys to be the number one choice for all things tech, helping customers shop however they want – online, in store or a mix of both – through our winning omnichannel model.
“We’ve delivered a strong peak performance in the UK and Ireland, growing profits again through resilient sales, increasing gross margins (not least through record services adoption) and strong cost discipline. Our transformation is visibly succeeding.
“Internationally, it remains tough and we continue to face into intense, but temporary, market pressures. We’re not simply waiting for the external environment to improve, of course. We’ve already reduced stock levels and stepped up our measures to increase margins and reduce costs.
“A massive thank you to our amazing colleagues who’ve worked so hard over peak to help millions of customers get the amazing tech they need. We all know it’s tough out there for many households, but our colleagues have been there for them. They’ve helped customers choose the right tech, as well as to afford and enjoy it to the full, whether it’s buying that must-have present, upgrading to a more eco-friendly washing machine, or replacing a broken laptop.
“While markets remain challenging, we’re confident in our full-year guidance as UK and Ireland improvements offset international weakness. Looking ahead, the results in the UK and Ireland show that we’re on the right path – we’re excited about our growing momentum and we intend to build on it.
“We’re also confident in returning our high-quality International business to robust profits and cash generation. Then we’ll see a group not just with today’s ever-growing colleague engagement and customer satisfaction, but with the sustainable cash flows to match.”
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