DSG Int. PLC - Interim Management Statement
RNS Number : 5974C
DSG International PLC
03 September 2008
7.00am, Wednesday, 3 September 2008
DSG INTERNATIONAL PLC
INTERIM MANAGEMENT STATEMENT
DSG international plc, one of Europe's leading specialist electrical retailers,
is today updating the market on trading for the 16 weeks ended 23 August 2008.
* Total Group sales up 4% in sterling, down 2% in local currency, and like
for like sales down 7%.
* The trading environment remains challenging across Europe.
* Gross margins across the Group were down 0.75% year on year.
* £50million cost reduction programme delivered. Additional £25million cost
savings targeted this year.
* Intense activity around the renewal and transformation plan announced in
May 2008:-
* 5 PC World stores refitted to new format - upgrading a further 25 PC World
stores in time for Peak.
* New format Currys and Currys.digital stores opening, with at least 10
stores reformatted in time for Peak.
* 20,000 colleagues will have completed the new customer service programme
before Christmas.
* 2 further large format stores opened in the Nordics and one to trial in
the UK shortly.
* Italian transformation plan underway, early results encouraging.
16 Weeks ended 23 August 2008
Sales Total growth Like for like growth
UK & Ireland Electricals (3)% (7)%
UK Computing (9)% (12)%
International
Nordic +5% (4)%
Southern Europe (1)% (12)%
Central Europe (3)% n/a
e-commerce (Dixons.co.uk & PIXmania) +6% +6%
Total Group +4% (7)%
John Browett, Chief Executive, commented:
'We have had a challenging start to the year, although we are trading against
tough comparables. The economic backdrop in which the Group operates remains
difficult across Europe, and we are managing costs and stock levels accordingly.
We remain
very cautious about the consumer outlook.
This is a period of intense activity for the Group as we action our three year
renewal and transformation plan and focus on the customer. We are revamping
ranges, retraining staff, and simplifying the business. Although we are only
four months in, a
lot of changes are already underway which will benefit both our customers and
our shareholders.'
Actions under the renewal and transformation plan
* 5 new format PC World stores have been opened. Based on initial success a
further 25 stores will be refitted to this new format in time for Peak.
* New format Currys and Currys.digital stores to be opened next week with 10
open for Peak.
* Large format store in Lrenskog, Norway continues to trade strongly. 2
further large stores now open in Sweden.
* New large format store of 50,000 ft2, based on the Group's successful
overseas format, will be opened in the UK shortly.
* Store colleagues in the UK are being trained in two key aspects, customer
service and product knowledge. It is expected that nearly all 20,000 colleagues
will go through the new customer service programme before Christmas.
* In Italy good progress in resolving the issues is being made. The closure
programme of uneconomic stores is underway. There are a number of trials in
place and three PC City's within UniEuro stores have now opened.
* The Group has delivered the £50 million cost reduction programme enabling
investment to be made in the customer proposition.
* In addition the Group expects to reduce costs across the whole business by
at least a further £25 million this year.
- Ends -
For further information
David Lloyd-Seed, Group Communications Director, DSGi 01727 205065
Mark Webb, Head of Media Relations, DSGi 01727 205019
Information on DSG international plc is available at http://www.dsgiplc.com
NOTES:
1) The change in total sales for the Group is in sterling and excludes
discontinued operations. All other figures are in local currency.
2) Like for like sales are calculated based on stores that have been open for
a full financial year both at the commencement and end of the financial period.
Customer support agreement sales are excluded from all UK like for like
calculations to remove
the distorting effect of the introduction of pay as you go customer support
agreements. Operations that are subject to closure have sales excluded as of the
announcement date.
3) UK & Ireland Electricals comprises Currys, Currys.digital and Dixons Tax
Free as well as the operations in Ireland.
4) UK Computing comprises PC World, DSGi Business and The TechGuys. Like for
like sales are for PC World only.
5) Nordic comprises the Elkjp group which now includes PC City in Sweden.
6) Southern Europe comprises Greece (Kotsovolos and Electro World), Italy
(UniEuro and PC City Italy), Spain (PC City Spain) and Turkey (Electro World).
7) Central Europe comprises Electro World in Poland, Czech Republic and
Hungary. These are excluded from like for like comparisons as the number of
stores trading are insufficient for a meaningful like for like comparison to be
made.
8) e-commerce division comprises Dixons.co.uk and PIXmania.
9) Gross margins for the Group now include the e-commerce division.
10) Movements in the financial position, including levels of borrowings, of the
Group since the last Annual Report are reflective of the trading performance
outlined above. Other than this, there have been no significant changes in
financial position.
11) Certain statements made in this announcement are forward looking statements.
Such statements are based on current expectations and are subject to a number of
risks and uncertainties that could cause actual results to differ materially
from any
expected future events or results referred to in these forward looking
statements. Unless otherwise required by applicable law, regulation or
accounting standard, we do not undertake any obligation to update or revise any
forward looking statements,
whether as a result of new information, future developments or otherwise.
Appendix
Prior year comparatives
The table below sets out the total sales and like for like sales for the 16 week
period to 18 August 2007 under the revised reporting structure of the Group.
16 Weeks ended 18 August 2007
Sales Total growth Like for like growth
UK & Ireland Electricals +4% +5%
UK Computing +5% +6%
International
Nordic +9% +5%
Southern Europe +13% 0%
Central Europe +25% n/a
e-commerce (Dixons.co.uk & PIXmania) n/a +28%
Total Group +11% +6%
Please see the Notes above in the main body of this announcement.
This information is provided by RNS
The company news service from the London Stock Exchange
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