Argos drives GUS growth
Catalogue stores outperform Chrismas market
The Argos business has once again delivered the goods for retail group GUS, outperforming the market over the Christmas sales period despite lower like-for-like sales.
In the 15 weeks to January 8, Argos saw total sales growth of 6 per cent, with like-for-like sales up just 1 per cent, well below rates recorded earlier in the year. DIY business Homebase saw total sales up 8 per cent, with like-for-likes up 4 per cent.
GUS said that with UK retail demand significantly weaker and competition tougher, Argos again outperformed its market “by offering consumers improved choice, value and convenience”.
New stores continue to perform well. While toys and jewellery were difficult markets, these categories’ contribution to sales in the third quarter is about double that in the rest of the year. There were particularly strong performances from consumer electronics, photography, white goods, mobile phones and leisure.
Home delivery business Argos Direct grew sales by 15 per cent, accounting for 18 per cent of revenue compared to 17 per cent last year. Internet orders increased by about a third, contributing 5 per cent.
The new Argos catalogue, launched this month, features 13,300 lines, 3 per cent more than a year ago, with Argos Extra catalogue offering 17,500 lines. Argos Extra, currently available in 157 stores, will be extended to a further 30 stores and the internet by early summer.
[img r]homebaseswindon.jpg[/img]Homebase opened four new stores in the quarter, bringing the total to 287. Like-for-like sales were boosted by the earlier timing of a ’10 per cent off’ event which figured in fourth quarter sales last year. New ranges in paint, tiling and lighting performed well, as did kitchens and bathrooms.
John Peace, group chief executive of GUS, said: “Despite a challenging retail environment, Argos again outperformed its market, with sales up 6 per cent and gross margin slightly ahead. Experian achieved a record quarter for growth, with an exceptional increase in sales of 30 per cent in North America. Against this background, we remain comfortable with expectations for the group for the full year.”
