Currys eases European worries for DSG

DSG International reassured on current trading today after seeing sales at its Currys electricals division grow 3% over the last financial year.

The absence of further shocks was welcomed in the City following a year of problems for the company’s operations in Italy and France.

While DSG’s sales performance in the final quarter of the financial year was affected by unseasonal hot weather in the UK, Currys still achieved like-for-like growth of 1% in the six months to April 28. Margins were also up.

DSG has been hit by trading difficulties in Europe, particularly in Italy following a sharp downturn in trading conditions. It is also pulling the plug on PC City in France and recently uncovered a “significant fraud” at its French online business Fotovista.

As a result of the difficulties, DSG will take a one-off hit of between €262m and €292m in the financial year just completed.

Chief executive John Clare added: “Overall we expect to deliver operating profit for the group in line with current market expectations for the year.”

Richard Ratner, a retail analyst at Seymour Pierce, kept his profits forecasts unchanged at €389m today. He added there was “considerable relief” that second half sales at Currys had shown improvement in the second half.