Dixons and Currys owner DSG International has called time on the retail boom in Ireland, stating that the housing downturn will result in a lower rate of expansion at the electrical goods retailer this year. Arthur Beesley, Senior Business Correspondent, reports.

Outgoing DSG chief executive John Clare said the impact of the property slowdown was "not dramatic" but his warning of slower growth in Ireland suggests housing market weakness is spilling into other economic sectors.

"We're still forecasting that our markets will grow this year and that our share will grow, and that we will grow profits," Mr Clare said in an interview.

"That doesn't mean that a downturn in the housing market and a downturn in the value of housing doesn't have an impact on our business, so we are anticipating, for example, that our markets in Ireland will be less strong this year than last year."

The expansion of London-based DSG, which also owns PC World, has brought the group to the fore in the Irish market in the 12 years since its arrival here. The business had a turnover of some €199 million in the year to May and pre-tax profits of €10.7 million. He said the product category most closely aligned to the turnover in the housing market, is major appliances: cooking, kitchen and utility room equipment.

"If the new housing market or the replacement housing market or the churn in the housing market slows down, that is the market that is most affected first," Mr Clare said.

"Having said that, it's not dramatic, 80-90 per cent of the market is replacement. The percentage of market driven by housing transactions is 20 per cent."

He said he could still reliably forecast that the electrical goods market will be substantially robust, even in a housing downturn, but said there could also be a knock-on impact on discretionary spending from people who increase their mortgage exposure to pay for household goods. "Clearly if there's less housing and mortgages are slowing down, there's less money coming into the market through that particular vehicle," he said.

Mr Clare was speaking during a visit to Ireland to open DSG's first franchise outlet here. Asked if he was concerned about the potential impact on his business from the property downturn, he said: "Concern is the wrong word. We're in this business not just for this week or this month, but for the long term. There's uncertainty in markets around the world. There's uncertainty where consumer and credit markets are going.

"We've been in business for 70 years, in Ireland 12 years. We're perfectly capable of managing business through ups and downs."