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Comet sales fall sharply

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by Kay Mitchell
”Comet

Figures today show consumers continue to cutback in the face of higher inflation and rising unemployment after Kesa, the parent company of electrical retailer Comet, revealed a sharp fall in sales.

Total revenue in the previous three months fell by 9.8% on a like-for-like basis while sales slumped almost 22% after the company blamed weak trading.

However, the company said the fall was expected and compares with strong sales in 2010 due to the football World Cup and the popular launch of Apple’s iPad.

Kesa also claimed that Comet sales had shown “an improving trend through the quarter”.

Chief executive Thierry Falque-Pierrotin comments: “The start of the year has been tough against the strong World Cup comparatives of last year and weakening market conditions.”

The weak figures follow a 6.8% decline in sales at Comet announced in June, sending the UK electricals business into a €10 million (£9 million) loss.

The figures come just a day after the John Lewis Partnership, which is regarded as a barometer of British retailing, has reported a marginal increase in sales and said trading conditions are “extremely challenging”.

The renowned employee-owned chain, which owns the Waitrose supermarket chain, said sales rose 1% on a like-for-like basis in the six month period to 30 July.

However, across the group, first-half pre-tax profits slumped by 18% to £90.4 million.

In addition, last week, Home Retail Group announced a drop in sales at both its Argos and Homebase chains, while electrical goods chain Dixons Retail posted a fall in sales.

Accountancy firm BDO recently warned Britain’s retailers should prepare themselves for some tough times as pressure builds on consumers in the run-up to Christmas.

Several retailers are under severe financial strain as the face their quarterly rent deadline at the end of this month.

Earlier this year, the rent deadlines at the end of March and June resulted in a series of retailers entering administration including Focus DIY, Habitat, TJ Hughes and fashion chain Jane Norman.

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News posted: September 15, 2011

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