DIXONS RETAIL, Europe’s second largest electronics retailer, reported a decline in sales over the Christmas period, though it managed to improve its margins in spite of widespread discounting on the high street.
The owner of Currys and PC World said sales at stores open more than a year fell by five per cent in the 12 weeks to 7 January, driven by poor sales across the UK and Ireland, Greece and Italy.
However chief executive John Browett said the firm enjoyed its strongest ever promotions and increased its gross margin by 0.4 per cent, after selling more products like iPads and headphones at full price.
“This is a solid performance against a challenging backdrop. Our service-led business model continues to win over customers in all our key markets,” Browett said.
Dixons said it had seen a surge in UK trading since the anniversary of the VAT sales tax rise on 4 January, with like-for-like sales up 23 per cent over the 10 days to 14 January.
The electronics market is one of the largest victims of the consumer downturn, however Dixons said it was outperforming the market, benefitting from rival Best Buy exiting the UK and the sale of Comet.
Its southern Europe arm, including Italy and Greece, was the worst hit, with like-for-like sales falling 10 per cent, but Browett reiterated Dixons’ commitment in those countries.
He also played down concerns over a £150m bond repayment due in November and said: “We are in good shape...we have the cash and bank facilities to repay the bond.”