HRG's Argos sales down 2.8%

Home Retail Group (HRG) said like-for-like sales at Argos fell 2.8% to £897m in the second quarter due to a drop in sales of electrical goods driven by TVs, tablets and white goods. Total Argos sales fell 0.4%.

Like for like sales at Homebase grew 5.9% to £378m in the quarter, boosted by stock clearance sales, but overall sales actually fell 2.8% due to store closures.

Internet sales represented 46% of total Argos sales in the quarter, up from 44% for the same period last year. Within this, mobile commerce sales grew by 11% to represent 25% of total Argos sales, up from 22% in the prior year.

HRG added that the approximate 125 basis point gross margin improvement was principally driven by the anticipated impact of favourable currency and shipping costs, together with the continued timing benefit of a small number of other positive items which are expected to reverse in the second half of the current financial year.

These increases were partially offset by an increased level of promotional sales.

Chief executive John Walden said the full-year outcome for HRG usually depends on the Christmas sales period, but warned that this year's seemed “less predictable than usual due to a less certain promotional environment”.

“Our teams have made solid progress preparing for this period, including substantially completing the technology and operational steps necessary to introduce new store collection and home delivery propositions to our customers,” he said.

“We will be making increased marketing and promotional investments to launch these propositions and we expect customers to increasingly embrace them over time."