The High street's festive woes caught up with GUS yesterday, which revealed that underlying sales at Argos, the catalogue retailer, had slowed sharply.
The High street's festive woes caught up with GUS yesterday, which revealed that underlying sales at Argos, the catalogue retailer, had slowed sharply.
But a stellar contribution from the group's credit-checking arm, Experian, more than compensated, sending GUS shares 26p higher to 931p.
GUS said like-for-like sales at Argos rose just 1 per cent during the 15 weeks to 8 January, down from 7 per cent comparable growth in its first half.
David Tyler, the finance director, admitted Argos's sales had undershot internal forecasts but said its gross margin had grown. "The market was very difficult. Competition intensified but we've come out in decent shape," he said. Toys and jewellery - Argos's biggest markets - were "still tough" after consumer demand switched to electronic gadgets such as portable DVD players, Mr Tyler added.
Woolworths' cited poor toy sales when it warned on profits last week. Signet, the owner of the H Samuel and Ernest Jones jewellery chains, also unveiled sharply lower growth, with a 1.5 per cent rise in UK like-for-like sales for the 9 weeks to 1 January. Signet's group sales, which are skewed, to the US, rose 3.7 per cent over the period. Mothercare was another disappointment. Its like-for-like sales were 1.6 per cent lower in the eight weeks to 7 January, although its gross margins were flat.
GUS, which has a controlling stake in Burberry, has placed its business under review with, analysts believe, a mind to splitting it up. Analysts at Dresdner Kleinwort Wasserstein said Experian's strength made it more likely that GUS would demerge it, rather than sell.
Sales at Experian, which accounts for about one-third of group profits, jumped 19 per cent in the three months to 31 December. Homebase, its home improvement chain, grew its like-for-like sales by 4 per cent, although the figure was boosted by an "extra 10 per cent off" day.
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