May 09 2007

Is Argos the Amazon of the UK?

Home Retail Group has announced an 8% increase in operating profit despite a drop in sales at DIY chain Homebase. The figures for the financial period to 3 March, show group sales at £5,607 million.

The company is pleased with the year-end position following the demerger from GUS plc and says that during the year it "capitalised on clear multi-channel leadership".

Terry Duddy, Chief Executive of Home Retail Group, commented: "We are pleased to report that both Argos and Homebase have performed well, benefiting from the shared infrastructure and capabilities of the Group while continuing to invest for future growth. The combination of a strong operational performance, together with a clear strategy for growth, means we are well positioned and confident of making further progress in what we expect to be another challenging year for UK consumer spending."

Keith Bowman, equity analyst at Hargreaves Lansdown commented to The Guardian, "Distribution remains a key strength at Argos, with internet orders up by 45% and now representing over 16% of total sales. It could perhaps be argued that Argos is slowly becoming the Amazon of the UK."

Emma Herrod