Argos and Homebase results ‘exceed expectations’

The performance of both Argos and Homebase was better than expected in the half year to August 29, Home Retail Group chief executive Terry Duddy said this morning.

Argos and Homebase results 'exceed expectations'

Sales rose 3% to £2,805m from £2,736m in 2008: like-for-like sales dipped 2% at Argos but were up 3% at Homebase. Benchmark operating profit was up 14% to £121m (2008: £106m), with a decline of £6m or 7% at Argos but an increase of £19m or 66% at Homebase. Reported profit before tax was £116.8m.

Both Argos and Homebase grew market share.

The company reduced operating and distribution costs by £32m or 3% to £986m as cost management more than offset volume-related growth and inflation.

The internet now accounts for 28% of total Argos sales, and its online Check & Reserve facility grew by nearly 50%.

Commenting on the results, Terry Duddy said: “The trading performance at both Argos and Homebase exceeded our expectations. Our focus on cash margin and an extremely tight control of costs have been the clear drivers of a successful first half performance.

“We continue to plan cautiously for consumer demand over the remainder of the financial year, and there will also be a more significant impact from adverse currency movements during this period.”

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