• Argos like-for-likes fall 2.2% in the 18 weeks to January 2
  • Homebase like-for-likes up 5%
  • Australian retailer Wesfarmers poised to buy Homebase as Sainsbury’s circles Argos

Home Retail has warned full-year profits will be at the lower end of its forecast as like-for-like sales fell 2.2% at Argos.

However, total sales at Argos in the 18 weeks to January 2 rose 0.9%.

Chief executive John Walden said Argos was hit by “volatile” trading patterns. This was due to "strong sales during Black Friday week, a shift in consumer demand from both the weeks before and after Black Friday, growth in digital transactions, reduced store footfall particularly on the high streets, and the continuing effects of price deflation”. 

Home Retail revealed yesterday that it is in advanced talks to sell Homebase to Australian retailer Wesfarmers. Meanwhile, Sainsbury’s is looking to make a formal bid for the rest of Home Retail, including Argos, after having an initial approach rejected in November.

At its Homebase business like-for-likes grew by 5% in the 18-week period, while total sales declined 4%.

Walden said a “productivity” drive at Homebase, which includes an “aggressive” store closure program, cutting overheads and improving the customer proposition has “begun to position Homebase as a smaller, higher quality and more efficient business”.

Home Retail said it now expects group full-year pre-tax profits to be at the “bottom of the current range” of market expectations of £92m to £118m.

 

 

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