Dixons's PC sales buck UK market trend

Dixons Group has reported increased PC sales well ahead of the total UK market growth, with sales from its PC World business division growing by 34 per cent to £111m.

Dixons Group has reported increased PC sales well ahead of the total UK market growth, with sales from its PC World business division growing by 34 per cent to £111m.

Overall, PC World sales were £997m for the year ended 29 April, up 26 per cent in total compared with the previous year, and up seven per cent excluding new stores. Dixons claimed this compares with the overall UK PC market which saw a 10 per cent increase in unit sales in the same period, but only a two per cent rise in value.

Dixons said part of its success was because of improved stock management, which has made PC World a cheaper route to market for vendors, and allowed it to keep up with the latest technologies at competitive prices.

Online sales reached £4.4m, representing a six-fold increase on the previous year, but still a tiny fraction of Dixons's overall business. Dixons plans to invest £30m in logistics infrastructure over the next two years to support its combined online and high street sales operations.

In addition, Dixons said effective supply chain management reduced costs as a percentage of sales by 0.7 percentage points, despite increased rents. This resulted in a 16 per cent improvement in stock turn.

Stanley Kalms, chairman of Dixons, said: "It has been a year of achievement for Dixons Group. Another strong set of results were produced in a challenging retail environment. There are a number of challenges ahead, but the group is in an excellent position to take advantage of the opportunities in its markets."

Total turnover from all of Dixons's activities increased by 23 per cent to £3.9bn and profit before taxation, exceptional items and Freeserve was up by 11 per cent to £263.7m. Including the Freeserve flotation, profit increased 104 per cent to £472.1m.