Dixons returns to profit in UK
Dixons, the owner of PC World and Currys, has seen its UK and Ireland division make a return to first half profitability for the first time in five years.
In the 24 weeks to 13 October, total sales rose by 2% in the UK and Ireland while and like-for-like sales increased by 3%.
Group chief executive Sebastian James said: “I am particularly encouraged by our performance in the UK & Ireland and in Northern Europe and we were particularly busy during the sporting and cultural events during the summer. While August and September were, as expected, a bit quieter, we remain cautiously optimistic about the outlook. It is increasingly clear in each of our markets that our service-based, multi-channel business model is what customers want.”
On a group wide basis, total underlying sales were flat at £3.29 billion while EBIT rose by £5.1 million and like-for-like sales by 3%. The group saw its underlying pre-tax loss narrow at £22.2 million from £25.3 million in the same period last year.
Never Miss a Retail Update!However, Dixons made a total loss before tax of £79.5 million compared with a £2.4 million profit a year earlier following the poor performance of its online gadget subsidiary Pixmania. The company said it had made a £45.2 million writedown in Pixmania’s value.
Pixmania saw like-for-like sales drop 7% to £198.3 million although the group said it had taken day-to-day control from the management and was imposing “decisive actions” to improve the company’s performance.
Commenting on the results as a whole, James added: “We have made good early progress on our three strategic priorities of driving a sustainable business in a multichannel world, building on our leading market positions and have started to make some progress in sharing best practices across the Group.
“We have significantly reduced net debt, successfully undertaken a £150 million bond issue and delivered good underlying profit growth in the UK and Northern Europe.
“We have also improved our performance in Southern Europe and have now assumed full day to day control of Pixmania.”
