Currys full-year profits have plummeted 38% after inflationary pressures caused its Nordic’s business to come to “an abrupt halt”.
Adjusted pre-tax profits for the electricals retailer plunged to £119m in the year to 29 April 2023, down from £192m, weighed down by poor performance in its international arm.
On a statutory basis, the retailer dropped into the red with a pre-tax loss of £450m, due to a £511m impairment charge relating to the 2014 merger with Dixons Carphone.
Like-for-like UK and Ireland sales fell 7% to £5.1bn “driven by a fall in consumer spending due to persistent inflation and rising interest rates, as well as normalisation of spend on technology after strong growth during the pandemic”. Group like-for-like sales slipped 7% to £9.5bn.
Currys’ UK and Ireland business reported an adjusted EBIT increase of 45% to £170m thanks to the focus on more profitable sales, price increases and cost efficiencies in the supply chain.
The strong performance helped to offset a 73% decline in its international business due to “the consumer spending environment deteriorating rapidly over the past 12 months”.
Subscribe to Retail Gazette for free
Sign up here to get the latest news straight into your inbox each morning
Currys chief executive Alex Baldock said: “We’ve had a very mixed year. Our strengthening UK & Ireland performance shows our strategy is working well. But our long track record of success in the Nordics was brought to an abrupt halt.
“Our market has been tough everywhere, with depressed demand, high inflation and unforgiving competition.
“Looking ahead, we’re wary of optimism about consumer spending power. Accordingly, we’re being prudent in our planning, and in further strengthening our balance sheet,” he said.
Baldock said its focus was to continue its “very encouraging trajectory” in the UK & Ireland while its gets the Nordics business back on track.
“We may be cautious in our promises for the short-term, but our confidence is undimmed as we build a stronger and more resilient business that is fit to prosper in the longer term,” he added.
Click here to sign up to Retail Gazette‘s free daily email newsletter
