Dixons sales up after Comet demise
The owner of PC World and Currys benefited from the demise of rival Comet, reporting a bigger-than-expected surge in Christmas sales.
Dixons Retail said like-for-like sales in the UK and Ireland were up 8% in the 12 weeks to January 5, despite administrators for the failed retailer holding a clearance sale for the vast bulk of the period.
The group said sales of tablet computers were "phenomenal", with more than a million sold in the UK and Ireland over the period, with five a second in the week before Christmas.
Apple iPads made up a third of tablet sales, but it also had strong demand for the Samsung Galaxy and Google Nexus models.
Chief executive Sebastian James believed the group gained many new customers from Comet, prompting it to take on 500 permanent staff from the failed chain.
More than 1,000 of its temporary Christmas staff came from Comet after it went into administration in November. But the group warned that margins were down 0.5% in the period, with the mark-up on tablet computers lower than on laptops.
However, Dixons said it expected underlying profits for the year to be in line with market expectations of between £75 million and £85 million. Dixons shares, which were a star performer of 2012, were up 2% in this session and have now gained 155% in the last year.
Matthew McEachran, analyst at N+1 Singer, said he thought the full benefits of Comet's demise were yet to be seen.
He said: "We suspect disruption from clearance may not have been as bad as feared given the poor quality and limited amount of stock they had."
Richard Hunter, head of equities at Hargreaves Lansdown Stockbrokers, said the gulf on the high street between "the haves and have nots" was becoming increasingly evident on an almost daily basis. "Within this mix, Dixons is another Christmas winner," he said.