Rethink time
DSG international (DSGi) has announced its preliminary audited results for the 53 weeks ended 3 May 2008 and they make ugly reading.
While total group sales were up eight percent, underlying pre-tax profit was down over 30 percent to £205.3 million from £295.1 million a year ago.
However, even that profit was wiped out and then some, by one-off net restructuring and business impairment charges of £389.2 million, of which £341.3 million is attributable to its Italian operations.
The majority of the drop in underlying profit was attributable to a near halving of profits at its UK Computing division, which fell to £63.2 million from £124.6 a year ago. Ironically, its international computing operations have improved, only losing £12 million compared to £28.2 million a year ago.
“The Group is operating in a challenging environment,” said chief executive John Browett. “We have lots of opportunities to improve performance and build on the Group’s many inherent strengths as a leading specialist electrical retailer.
“We are working very hard on executing our five point plan that will renew and transform the business over the next three years. We are revamping ranges, retraining staff, trialling new store formats, selling new services, cutting costs and simplifying the business from top to bottom.”
Profit summary from DSGi preliminary results document, click to enlarge
