Dixons Retail, Europe's second-biggest electrical goods retailer, said its new financial year had got off to a good start after it posted a 17 per cent fall in 2011-12 profit against a tough economic backdrop.
The group, which trades as Currys and PC World in the UK, Elkjop in Nordic countries, UniEuro in Italy and Kotsovolos in Greece, said today the trends seen in the final quarter of the 2011-12 year, when like-for-like sales increased 5 per cent, had broadly continued.
"Our business is well-positioned for the year ahead," it said.
Dixons Retail said it made an underlying pretax profit of £70.8 million in the year to April 28th. That was a touch above company guidance of £65-70 million but down on the £85.3 million made in 2010-11. Underlying sales were flat at £8.19 billion.
European shoppers have been curbing spending as their disposable incomes are squeezed by rising prices, muted wages growth, government austerity measures and fears over the impact of the euro zone debt crisis.
Electrical goods chains such as MediaMarkt Saturn and Kesa are facing extra pressure from cut-price competition from supermarkets and internet retailers such as Amazon.
Kesa yesterday reported a 42 per cent slump in year profit.
Dixons was able to stem its profit fall by revamping stores and improving product ranges and customer service.
It has also benefited from the disarray of competitors Comet and Argos in its core home market, a switch to digital television in the southeast of England and the success of Apple's new iPad.
The group reduced its net debt to £104.0 million from £206.8 million a year ago and said it was on target to repay £160 million of bonds due in November and associated hedge cost of about £65 million.
Shares in Dixons, which have increased by 64 per cent over the last six months, closed yesterday at 15.9 pence, valuing the business at £574 million.
Reuters
