Dixons, Europe's second-biggest electrical goods retailer, posted a 6 per cent fall in year profit as the benefits of a plan to revamp stores and cut costs were offset by weak consumer spending on discretionary items.
The firm, home to the Currys and PC World chains in Ireland and Britain, said today it had reviewed its balance sheet given the tough conditions in its markets and made impairment and other charges totalling £309.4 million.
The charges relate to the closure of the firm's operations in Spain, and the impairment of goodwill at its Kotsovolos chain in Greece and Pixmania internet business.
Sales in Ireland and Britain were down 5 per cent to £3.8 billion with like-for-like sales declining by 3 per cent.
Consumers across Europe are cutting back on purchases of electrical appliances as household budgets are squeezed by austerity measures.
Dixons, which issued a profit warning in March, made an underlying pretax profit of £85.3 million in the year to April 30th. That compares with company guidance of about £85 million and £90.9 million in the 2009-2010 year.
Dixons, which also runs UniEuro in Italy and Elkjop in Nordic countries, said its revenue in 2010-11 was £8.34 billion, down from £8.53 billion .
Year end net debt was £206.8 million. "The economic backdrop remains challenging, particularly in the first half as we anniversary the World Cup and iPad launch. However the group is well prepared for this environment," the firm said.
Dixons added that finance director Nicholas Cadbury has resigned from the board to take up a similar role at Premier Farnell . He will be succeeded by Humphrey Singer.
Shares in Dixons, which have lost 44 per cent of their value over the last year, closed at 13.35 pence yesterday.
Reuters
