It has been widely reported today that electricals retailer Kesa has said it will cut jobs and close some of its stores in Spain as it announced a 7.5% drop in total like-for-like sales.
Overall however the company traded in line with its markets.
Kesa said actions are being taken to stabilise the Menaje Del Hogar business, which is expected to post a higher loss than expected of around €26m. These losses include the closure of one warehouse and distribution centre, streamlining the head office functions, store closures and a reduction in the number of staff working in the remaining store chain.
These actions are expected to generate cost savings of approximately €11m per year and contribute to a reduction in the retail loss for the coming financial year. An exceptional charge of around €10m will be taken in the year just ended.
Kesa added that Comet has also taken further actions to improve its operational efficiency, including the consolidation of distribution and service centres plus a reduction in head office staffing levels. An exceptional charge of about £9m will be taken in the year just ended, with cost savings expected to be approximately £14m per year.
Total group revenue increased by 5.6% in sterling and declined 4% in local currency in the period 9 January to 30 April 2009. French chain Darty reported a 5.8% like-for-like decline with like-for-like sales dropping by 7.3% at Comet.
“A strong focus on managing gross margin and costs helped us deliver a cashflow and retail profit performance for the full year in line with expectations,” said chief executive Thierry Falque-Pierrotin.
“A series of initiatives across the group are underway to prepare us for another challenging year,” he added