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Currys shares soar 10% despite cost-of-living crisis

Currys shares shrug off cost-of-living crisis to soar 10%, but electronics retailer warns outlook ‘uncertain’

Shares in Currys have soared despite warnings that the rise in the cost of living will hit profits this year.

The electronics retailer said the outlook was “uncertain” as households reined in spending in the face of higher energy and food bills.

Chief executive Alex Baldock admitted that buyers were under “severe pressure”.

Currys chief executive Alex Beldock said customers are spending more on technology than they would have before Covid hit, a trend he expects to continue

“We don’t expect that to improve in the coming months, so certainly discretionary income will be squeezed.”

Karis said profits this year would fall to between £130m and £150m, compared with the £164m analysts had estimated.

The group has lost 45 percent of its value this year amid fears that spiraling inflation will hit demand for major commodities.

But actions rose 10.5 percent, or 7 points, to 73.55 points yesterday.

Currys has seen shoppers return to stores after the Covid lockdown.

In-store sales jumped 61 percent in the year to May compared to the same period last year – higher than expected.

Total sales came in at £10.1bn, down slightly from £10.3bn last year. But profits rose 19 per cent to £186m.

Baldock said customers are spending more on technology than they would have before Covid hit, a trend he expects to continue.

He said: “It’s a consistently bigger market, even after the turbulence of the last few months, which remains true.

The technology market is bigger than it was before the pandemic because of the more important role that technology plays in people’s lives.”

Founded in 1884 by Henry Curry as a bicycle manufacturer, Currys has 314 stores in the UK and Ireland selling computers, home appliances, games consoles and other electronics.

Its results came amid continued turbulence at rival AO World, whose shares have fallen 41 percent since last Friday.

The company was forced to seek £40m in shareholder funding after an insurance company withdrew its cover.

Hargreaves Lansdown equities analyst Matt Britzman said: “On the one hand, profits beat expectations as higher costs were successfully offset by savings across the business and the return of in-store purchases boosted margins.

“On the other hand, the outlook still looks dim as inflation looks set to weigh on discretionary spending and spending across the board will continue to rise.”

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Currys shares soar 10% despite cost-of-living crisis

Source link Currys shares soar 10% despite cost-of-living crisis

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