Total sales at Argos declined by 4.0% to £505m in the eight-week trading period ending 28th February 2015. Net new space contributed 1.0%, while like-for-like sales declined by 5.0%. This trading performance was in part due to annualising a 5% like-for-like sales growth in the same period last year, together with the impact of a more difficult market in a number of consumer electronic product categories. Furthermore, in this period, Argos began to prioritise improved customer experiences following the rapid introduction of extensive new capabilities in prior periods. Taken together, these factors may continue to impact sales momentum in the next couple of quarters.
Full-year total sales grew by 1.1%, like-for-like sales increased by 0.6% and net new space contributed 0.5%. The store estate has increased by 21 stores to 755 in the year, an increase that is in line with previously announced plans. This increase comprised a total of 30 new stores which included 20 Argos digital concessions within Homebase and seven new small format digital stores, partially offset by nine store closures.
Full-year internet sales represented 46% of total Argos sales, up from 44% last year. Within this, mobile commerce grew by 38% to represent 25% of total Argos sales.
Full-year gross margin improved by approximately 25 basis points, principally driven by a reduced level of promotional activity together with the anticipated impact of favourable currency and shipping costs, partially offset by an adverse sales mix impact from the growth in margin dilutive electrical products.
