The owner of Homebase and Argos says the group has had ‘a good first half’ with sales up across both businesses.
Home Retail Group announced sales were up 3 per cent to £2.59bn for the first half of the year and like-for-like sales increased 5.9 per cent at Homebase.
The home improvement store, who have seen profits decline for five years in a row, has completed a further five store refits and launched a next or named day delivery proposition this year.
Argos’ like-for-like sales grew for the fifth consecutive quarter - up 2.3 per cent - as its transformation plan showed signs of progression.
43 per cent of total sales at Argos are now done online.
Jon Copestake, Retail Analyst, The Economist Intelligence Unit said: “The Homebase store facelift been helped along by a good summer and a rising housing market, which have fuelled sales of outdoor items, DIY products and furniture. On the other Argos has successfully adapted to a multichannel model by developing online and mobile sales to complement a strong physical store presence.
“This clicks and bricks approach, highlighted by the eBay tie-in puts the retailer in a good position ahead of what will be a challenging and competitive crucial Christmas shopping period.
The retailer tied up a click & collect deal with eBay a month ago which could grow sales in the future.
Mobile commerce also surged 124 per cent to account for 16 per cent of total sales at the general merchandiser.
Cash gross margin inched up 1 per cent to £962m and operating and distribution costs were held broadly flat at £936m.
Terry Duddy, Chief Executive of Home Retail Group, who will step down next July, said Argos and Homebase remain on track to deliver long term objectives .
“The Argos transformation is well underway, including the introduction of new smartphone and tablet apps, the extension of the ‘hub & spoke’ trial, the launch of a digital Christmas gift guide and the development of digital concept stores.”
He added: “We are in excellent operational shape as we approach the key Christmas trading period.”
Interim dividend remained at 1p.