Updates reveal high street woes

THE PARLOUS health of the high street will be further underscored this week by dire updates from two of Britain's biggest electrical goods retailers, one of which is thought to be seeking an exit from the UK market altogether.

Kesa, which is seeking buyers for 22 of its best Comet stores across the UK, will add to the chorus of high street gloom on Wednesday when it confirms continuing losses across its British chain.

Dixons Retail, parent company of PC World and Currys, will take up the reprise the following day as it posts lower full-year profits and warns of continued difficult conditions. The depressing figures will be in line with other recent downbeat updates from catalogue chain Argos and the combination of Carphone Warehouse and Best Buy UK, which saw losses at their "big box" joint venture triple during the past year.

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It also follows on last week's news that retail sales fell sharply in May, more than reversing the high street boost brought about by an abundance of fair weather and bank holidays in April.

According to official government figures, retail sales have been falling quarter-on-quarter in six out of the last seven months.

Kesa has already warned that the fall in same-store sales at Comet accelerated between the third and fourth quarters of its recently-completed financial year, with the pace of decline more than doubling to 15.2 per cent.

This is expected to all but wipe out a stronger performance by its successful Darty division in France.

Up to 10 Comet stores will be closed this year resulting in some 150 redundancies.

Kesa is also reportedly seeking buyers for some 22 of its prime UK sites, reviving speculation that it may ditch Comet altogether.

Meanwhile, Dixons Retail is tipped to post profits of between 80 million and 86m for the year to 30 April, compared with 90.5m previously.

The group, which has 1,200 stores in 28 countries, has issued two profits warnings this year despite efforts to boost customer service and restructure the business.

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In its most recent update, total sales for the UK were down 5 per cent for the year to April, including an 8 per cent slump in the second half.

Analysts will pressing Dixons for any further plans on how it can improve trade after it warned of more tough times ahead.

It has already opened new format stores and ramped up its cost-cutting by an additional 50m for the next three years.

But it has so far ruled out fresh store closures in the UK, where it employs about 20,000 people.

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