Home Retail Group operates with a clear scale advantage derived from a well invested infrastructure which has been built up over a period of many years.
The following information relates to the financial year ending 1 March 2014. Our latest trading update can be found here.
OPERATING HIGHLIGHTS
Good performances at both Argos and Homebase, with both businesses delivering positive like-for-like sales growth throughout the year
Argos Transformation plan progress:
Increased internet penetration to 44% of Argos’ total sales, including mobile commerce which grew 89% to account for 18% of total sales
Launched improved smartphone and tablet apps
Achieved 11.6 million customer registrations
Trialled ‘hub & spoke’ distribution model in 49 stores
Added aspirational new brands to Argos range
Trialled six digital concept stores
Homebase Renewal plan progress:
Completed another 12 store refits
Launched a next-day delivery proposition
Grew multi-channel sales by 53%
Reduced the store estate in line with plans
FINANCIAL HIGHLIGHTS
Sales up 3% at £5,663m
Cash gross margin up 2% to £2,034m
Operating and distribution costs up £13m to £1,921m as a result of ongoing investment in strategic initiatives across both Argos and Homebase
Benchmark operating profit1 up 21% to £113.0m
Benchmark profit before tax2 up 27% to £115.4m
Basic benchmark earnings per share3 up 35% to 10.4p
Reported profit before tax of £71.2m; reported basic earnings per share of 6.8p
Year-end cash balance of £331m
Full-year dividend up 10% at 3.3p (FY13: 3.0p); final dividend of 2.3p recommended
1 Benchmark operating profit is defined as operating profit before amortisation of acquisition intangibles, post-employment benefit scheme administration costs, store impairment and onerous lease charges or releases and costs or income associated with store closures and exceptional items.
2 Benchmark profit before tax (benchmark PBT) is defined as profit before amortisation of acquisition intangibles, post-employment benefit scheme administration costs, store impairment and onerous lease charges or releases and costs or income associated with store closures, exceptional items, financing fair value remeasurements, financing impact on post-employment benefit obligations, the discount unwind on non-benchmark items and taxation.
3 Basic benchmark earnings per share (benchmark EPS) is defined as benchmark PBT less taxation attributable to benchmark PBT, divided by the weighted average number of shares in issue (excluding shares held in Home Retail Group’s share trusts net of vested but unexercised share awards).www.homeretailgroup.com/investor-centre/financial-performance/
