Argos owner hikes dividend as profits rise

Home Retail Group, the owner of catalogue store Argos and DIY chain Homebase, today said shareholders were in line for a 10 per cent rise in their dividends as it reported a jump in annual profits.

The firm said underlying pre-tax profits soared 27 per cent to £115.4 million in the year to 1 March, on sales 3 per cent higher at almost £5.7 billion.

New chief executive John Walden, who succeeded long-standing boss Terry Duddy last month, said total sales at Argos grew 3 per cent to £4bn, helped by a strong rise in revenues over the internet, which now account for 44 per cent of total takings.

Demand for gadgets such as tablet computers and video game systems “more than offset” declines in furniture and jewellery.

Homebase sales were up 4.1 per cent at £1.5bn, with demand for “big ticket” items like kitchens and bathrooms ahead of last year.

Walden said: “The group has delivered a good performance in what remained a challenging market. Both retail businesses recorded positive like-for-like sales for all four reporting periods, resulting in 27 per cent growth in group benchmark profit before tax.”

The board recommended a final dividend of 2.3p a share, to be paid on 23 July, giving a total payout for the year of 3.3p – an increase of 10 per cent on last time.