DSGi suffers sales drop

DSGi Business headquarters

DSG international’s (DSGi) shares were thumped again this morning as the retailer put out a lacklustre interim management statement.

The electricals giant said it is targeting a further £25m in costs savings this year after unveiling a 7 per cent drop in like-for-like group sales for the 16 weeks ended 23 August.

UK computer sales were down 12 per cent on a like-for-like basis, while total UK and Ireland like-for-like sales fell 7 per cent. Like-for-like sales in the Nordics and southern Europe dipped 4 and 12 per cent respectively. DSGi’s shares fell 5 per cent on the news.

Newly installed chief executive John Browett admitted it had been a “challenging” start to the year, and said he remained “cautious” about the consumer outlet.

The statement comes a week after DSGi admitted around 50 jobs are under threat at its DSGi Business arm, which some channel sources say is not a priority for new management as they look to revamp its consumer business.

The retailer said it is pushing on with the ‘renewal and transformation’ plan it unveiled in May. This includes the ongoing reformatting of its PC World, Currys and Currys.digital stores. Additionally, a new 50,000 square-foot large format store will be opened in the UK shortly, which is based on the group’s overseas format.

DSGi also announced that its chairman, Sir John Collins, will step down from the board in 2009.

Collins said: “With a new chief executive and group finance director in place, and having served as chairman of DSGi for six years, it is now an appropriate time for a new chairman to oversee the group through the very exciting renewal and transformation plan John Browett has laid out.”

Browett said: “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.”