Argos warns of profit dip

Argos owner Home Retail has warned that first half profits will be down by 20-25 per cent.
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Argos saw like-for-like sales fall five per cent for the half, with less demand for video games and furniture, while Homebase saw flat like-for-like sales.

Sales at both of the brands were very different - Argos had trouble moving bigger priced items, but Homebase had strong sales in bedrooms, kitchens and bathrooms.

Home Retail chief executive Terry Duddy said that the second quarter was better to start with at Argos, even though the market was more challenging.

Some commentators are already saying the performance of Argos is an ominous barometer for the Christmas period.

The Group expects to report a full-year pre-tax profit of £250-£275 million, which is at the lower end of expectations from industry experts. Capital expenditure is projected to increase over 50 per cent to about £150 million, with much of it going toward store refurbishments.

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