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Poor sales in Europe drag Kesa down

KESA, the group which owns Comet, said yesterday its first quarter sales had slumped 3.9 per cent year on year, as the downturn in Europe outweighed a slight UK recovery.<br /><br />Sales at Comet went up 0.3 per cent, compared to the same period last year, but the company&rsquo;s French unit Darty saw sales drop by 3.7 per cent. <br />Kesa, which is the third biggest electronics retailer in Europe, saw sales at other chains in Europe drop 10 per cent, as customers cut back on &ldquo;big ticket&rdquo; items.<br /><br />&ldquo;We remain cautious on the French consumer and results from its other international businesses are weak,&rdquo; Investec analyst David Jeary said. <br />He added: &ldquo;The shares have had a strong run into this statement but some upgrades are expected.&rdquo;<br /><br />Kesa said its gross margin remained stable at Darty and that the rate of gross margin decline continued to ease at Comet, helped by an improvement in sales of white goods.<br /><br />&nbsp;Analysts had expected like-for-like sales to fall by between four per cent and six per cent at Darty, and to be down by between four per cent and eight per cent at Comet.<br /><br />&ldquo;The group overall traded in line with its markets but experienced widely varying geographic market conditions,&rdquo; Kesa said.<br /><br />&ldquo;All of the businesses have maintained a strong focus on protecting retail profit and have prepared themselves for the more significant trading period ahead,&rdquo; it added.<br /><br /><strong>FAST FACTS </strong> KESA<br />Kesa owns Comet, which has 250 stores, in the UK, and Darty in France. It is Europe&rsquo;s third biggest electronics retailer.<br /><br />Sales in the UK were up 0.3 per cent, but European sales slumped by 10 per cent.