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.
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.”