Currys – Customers Trim Spending On Computers

  • Full year guidance remains unchanged
  • Group sales down 4% in 17 weeks to 26 August
  • Computer sales weak
  • Cost savings still front and centre

Currys’s Full Year Guidance Remains Unchanged

“Electrical goods specialist Currys PLC (LON:CURY) has confirmed guidance for the full year remains unchanged. While that’s not exactly bad news, it’s also not overly encouraging. Margins remain a challenge, partly because of the very tough price environment. At the same time, the higher interest rate and inflation environment means customers are stalling on buying new computer goods.

Domestic appliances are faring better, which is a good sign in terms of consumer resilience, but the weakness in other areas suggests customers are starting to be more selective. This could heap further pressure on margins as we barrel towards the festive trading season.

While Currys is pulling all the levers at its disposal to get profitability off the ground, it’s relying heavily on cost savings. This is by no means a bad approach, but cost savings can’t go on for ever. The market is hunting for clues that organic demand and volumes are capable of propping up the bottom line.”

Article by Sophie Lund-Yates, lead equity analyst at Hargreaves Lansdown