Currys ups profit outlook thanks to improved UK trading

Currys has raised its profit outlook for 2022-23 after better-than-expected trading in its home market in the final two months of the year.

This comes as the electrical retail giant issued its latest trading update for the year ending 29 April 2023. Profit for the year is now set to fall between £110 million and £120 million, more than the previously expected £104 million. But that’s still down from £126 million last year.

The company said in its report that UK and Ireland trading has been “better than expectations”, especially in the final two months of the year. However, like-for-like sales in the region fell by four per cent in its second half, having been down 10 per cent in the first. Overall group sales for the full year were down seven per cent.

UK and Ireland profits are set to rise by 40 per cent, with especially strong trading in March and April. Currys said that the improvement in UK and Ireland profits was “driven by continued gross margin improvements and management focus on cost efficiencies”.

Elsewhere, the business continued to struggle in the Nordics. The retailer said it had “made progress” to cut costs there, but the one-off actions to reduce those expenses will themselves cost between £15 million and £20 million.

Currys, which expects to end the year with debt of around £100 million, also said its lenders had amended the fixed charge cover covenant on its 500 million pounds revolving credit facility, providing increased financial resilience.