Electical retailer DSG International posted an expected 61 per cent rise in full-year profit and forecast more growth in 2010-11 as its turnaround plan gains traction.
The firm said that although the economic backdrop in Europe would remain challenging in the current year it was well placed to continue to grow profits.
"The group is well prepared for this environment ... group profitability will continue to improve," said chief executive John Browett.
DSG also said that subject to shareholder approval it will change its name to Dixons Retail to harness the strength of the Dixons brand, which was the group's previous name.
The firm, which also runs the Currys and PC World chains, is two years into a turnaround plan that has focused on cutting costs and stocks, selling underperforming businesses, revamping stores, opening larger stores and improving customer service.
Shares in DSG have lost 24 per cent of their value over the last six months, lagging a 12 per cent rise in the STOXX 600 European retail index, hit by competition from supermarkets and the internet.
The stock was up 3.4 per cent at 28.3 pence at 0705 GMT, valuing the business at £1 billion.
Despite growing signs of economic recovery, many of Europe's retailers are still struggling with consumers reluctant to spend amid fears that taxes and unemployment will rise as governments take steps to reduce their debts.
DSG made an underlying pretax profit of £90.5 million in the year to May 1st. Total sales increased 3 per cent to £8.5 billion, with sales at stores open over a year up 2 per cent and up 6 per cent in the second half. Gross margins were flat.
The firm, which more than halved its net debt during the year to £220.6 million, is not paying a dividend.
Reuters