Dixons' recovery looks to be on track as half-year results due

Dixons' recent trading figures suggested its recovery plan was paying off.

Its first quarter update in September revealed UK like-for-like sales increased by six per cent, buoyed by an exclusive deal to market the iPad, as well as promotions on televisions at the time of the football World Cup.

Analysts at Execution Noble are expecting interim figures to show the same positive trends after a survey of 700 customers at Lakeside Thurrock shopping centre, where the Currys brand competes with Best Buy and Comet.

Execution claimed the results signalled that Currys' price perception was strong and that it can compete on price with Best Buy, which recently launched in the UK.

Comet has fallen behind in pricing and Best Buy has yet to establish a name for itself, the broker added.

Execution Noble recently raised its profits forecast for the retailer for the full year by 15 per cent to 138m.

Dixons Retail – formerly known as DSG International – is two-thirds of the way through a three-year revival plan.

It reported a 61 per cent rise in underlying pre-tax profits to 90.5m for the year to May 1.

The group has launched new format stores such as Currys Megastores and combined Currys and PC World 2-in-1 shops as it tries to attract customers with wider ranges and improved service.

It plans to refurbish around 100 stores in the UK and Ireland in the 2010/11 financial year, with the majority ready for Christmas.

Harvester and All Bar One owner Mitchells & Butlers will report back on efforts to transform itself into a food-led business when it delivers full-year results tomorrow.

The group is rolling out a strategy to focus on food sales as part of an overhaul announced in March to invest in its six mid-market eateries, including Harvester, Toby Carvery, Crown Carveries and Sizzling Pub Co.

Restaurant-led pubs are an attractive area for the entire industry after the smoking ban, alcohol duty increases and the recession impacted the drinking market.

M&B's food-focused offering suffered during the World Cup earlier this year, but it revealed in September that sales have since picked up, ahead by 3.6 per cent in the nine weeks to September 18.

Food sales rose by seven per cent in a sign that its strategy is bearing fruit.

Analysts at JP Morgan Cazenove believe M&B's full-year figures will show casual dining sales improved further in October, while they expect some benefit to sales figures of early price increases ahead of the VAT rise to 20 per cent in January.