Home Retail Group (HRG), which also owns the Homebase DIY chain, pleased the market last month by hiking profit forecasts following a robust fourth quarter.
Argos sales jumped by 4.3 per cent to £501 million in the eight weeks to 2 March and were up by 5.2 per cent on a like-for-like basis, despite weaker trading in homewares. But another tough year for DIY chain Homebase offset progress at Argos and the group is expected to see overall profits fall 11 per cent to £90m.
However, the focus is likely to settle on the turnaround story at Argos after HRG announced plans in October to scale back circulation of its Argos catalogue and revitalise the business through its digital presence.
Its 700-plus stores have been kitted out with wireless internet access, with a fast-track collection service and customer service for orders.
Internet sales now account for 43 per cent of Argos’ total revenues, up from 40 per cent a year ago, as more shoppers take advantage of the chain’s new tablet and smartphone apps, as well as click and collect services.
Home Retail hopes to grow Argos turnover from this year’s £3.9 billion to £4.5bn in 2018 in an “ambitious but achievable” overhaul after a period of declining sales.