Home Retail Group profits down 24%

| April 29, 2009 | 0 Comments

The Home Retail Group, which own Argos and Homebase, has announced that annual profits to the year ending 28th February are down by 24% with pre-tax profits of £328m compared to £433m the previous year.

Total sales are down by 1 percent to £5.9bn, as the group stated that they have been affected by the economic downturn and warned against tough times to come, with the weakness of the pound likely to result in a rise in prices as the difference is being passed on to consumers.

A loss before tax was booked at £394m as a result of non-cash asset writedowns at Homebase.

Over the course of the year, like-for-like sales at Argos stores fell 4.8 percent and Homebase a 10 percent fall.

Oliver Stocken, Home Retail Group’s chairman, said that the group is still well placed for the future and that they are cautiously planning their direction to take into account consumer confidence for household spending

Analysts have stated that by telling investors that the group was forced into the Homebase writedowns, they are basically admitting that they paid too much for Homebase from private equity group Permira in 2002.

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