Argos owner posts sharp sales fall

Home Retail Group said Argos sales were down 8.1 per cent on a like-for-like basis, leading to a 5.2 per cent drop in revenues to 889 million in the 13 weeks to May 29.

It said consumers had been reluctant to spend due to economic uncertainty, with the video games market particularly hit after a strong performance last year and television sales down despite the forthcoming World Cup.

Freddie George, a retail analyst at Seymour Pierce stockbrokers, said the Argos figures were "disappointing and quite lot worse than expected".

He added: "The company has had two poor quarters with the like-for-likes almost double-digit down. Competition, we believe, is intensifying particularly from the food retailers ramping up their internet offer and effort."

At Homebase, which is also owned by Home Retail Group, like-for-like sales declined by 1.4 per cent and by the same level on a overall basis to 459 million.

Shares were 5 per cent lower today.