Argos hit as sales of TVs switch off

ARGOs owner, Home Retail Group, blamed poor demand for televisions for a 3.9pc fall in firstquarter sales – even though rival Dixons Carphone said only days ago that TV sales are booming.

HRG, which also owns Homebase, is trying to transform itself from a catalogue business into a major online player, offering click-and-collect and same-day deliveries.

But it said total sales fell an expected 2.6pc to £846m because of a slump in the market for electrical products. shares rose 3pc or 4.9p to 164.4p.

Chief executive John Walden said: ‘As anticipated, sales in electrical products declined,’ adding that this was driven by a drop in sales of TVs, computers and tablets – all popular items in other shops.

Dixons Carphone last week beat City forecasts with a 13pc rise in underlying fourth-quarter sales. It said customers had been splashing out on televisions costing up to £2500 at its Currys and PC World outlets.

But Walden claimed Argos was ‘doing well’ in a ‘difficult and negative’ overall market for TVs.

He said the next wave of technology was ‘4k’ TVs, which are wafer thin and offer high picture quality. ‘We expect to sell many of [these],’ he added.

Argos expects to benefit from sales of the wafer-thin sets when their price drops. The firm said weather was a negative factor.

Walden is cutting Homebase stores and shut 17 in the quarter.

Underlying sales – stripping out the effect of store openings and closures – increased 5.4pc, but total sales declined 1.6pc to £438m.

Finance director Richard Ashton said: ‘We had a cold May so Argos sold fewer outdoor toys and garden furniture as did Homebase which also suffered on horticulture.’