Argos still game despite sales dip

TOUGH markets in video games and jewellery depressed festive like-for-like sales at catalogue shopping group Argos, owner Home Retail disclosed yesterday.

Sales at Argos fell 4.9 per cent in the 18 weeks to 1 January, which includes its third-trading quarter, virtually treading water with the 5 per cent decline seen in Q2.

Terry Duddy, chief executive of Home Retail, whose other subsidiary, DIY group Homebase, also reported falling sales, said: "Argos has performed in line with our original expectations for its peak period, despite some particularly challenging and volatile trading conditions in the build-up to Christmas."

Total sales at Argos fell 3.2 per cent to 1.9 billion, despite new space chipping in with a 1.7 per cent gain. Home Retail said: "In difficult markets, video gaming continued to be the most challenging category and televisions were down against last year's good performance. The jewellery category was also weak."

In video gaming, consoles and other hardware were down hardest, a key area for Argos. Analysts said that market was probably 20 per cent down this Christmas, with Nintendo Wii 40 per cent lower, having enjoyed a couple of years of strong growth.

By contrast, Home Retail said Argos saw an "excellent performance" in laptops and electronic "tablet" products.

Homebase's same-floorspace sales slid 1.2 per cent, with total sales down 2.8 per cent, in what Duddy said was "for them a less seasonally important selling period".

Home Retail said that it now expected annual profits for the financial year to be around the mid-point of its previously guided range of 250-275 million.