Page last updated at 21:43 GMT, Thursday, 15 May 2008 22:43 UK

Currys.digital to close 77 stores

Currys.digital store
Retailers are going through tougher times as the UK economy slows

DSG International, the owner of Currys and PC World, is to reduce the number of its Currys.digital stores and cut its dividend as part of a revival plan.

It said 77 Currys.digital shops out of the 177 outlets would shut as their leases expire over the next five years.

The closures are part of a major shake-up of DSG, which it hopes will cut costs by 50m in 2008/09.

The announcement came as DSG reported a 1% rise in like-for-like sales for the year to 3 May.

DSG's shares tumbled almost 12% on the news, but later rebounded somewhat to close 7.5% lower at 65 pence.

Customers have become increasingly promotion and deal driven, impacting margins
John Browett, DSG boss

High Street gloom

DSG has issued two profit warnings this year amid a challenging trading environment as cash-strapped consumers struggle with higher household bills and mortgage repayments.

DSG's new chief executive John Browett warned that the deteriorating economic backdrop made it difficult to forecast business performance.

"Customers have become increasingly promotion and deal driven, impacting gross margins," he said.

Tony Shiret, an analyst at Credit Suisse, said that Mr Browett expected the internet to take 30% of the UK electricals market over the next three or four years, compared with the 10% it currently accounts for.

"So the outlook for the company's shops obviously looks pretty grim," he added.

The transformation of the DSG group will include store refits at Currys, PC World and Currys.digital, and cost savings at its head office.


SEE ALSO
New profit alert from Currys firm
10 Apr 08 |  Business
Currys owner issues profit alert
03 Jan 08 |  Business
Laptop surplus hits Currys owner
28 Nov 07 |  Business
Tesco man to head up Currys owner
07 Jun 07 |  Business
Currys owner ends Russian plans
20 Jun 07 |  Business

RELATED INTERNET LINKS
The BBC is not responsible for the content of external internet sites


FEATURES, VIEWS, ANALYSIS
Has China's housing bubble burst?
How the world's oldest clove tree defied an empire
Why Royal Ballet principal Sergei Polunin quit

BBC iD

Sign in

BBC navigation

Copyright © 2017 BBC. The BBC is not responsible for the content of external sites. Read more.

This page is best viewed in an up-to-date web browser with style sheets (CSS) enabled. While you will be able to view the content of this page in your current browser, you will not be able to get the full visual experience. Please consider upgrading your browser software or enabling style sheets (CSS) if you are able to do so.

Americas Africa Europe Middle East South Asia Asia Pacific