Reuters reports that Dixons said on Thursday it would like to sell its loss-making Pixmania online business and if that proved to be not possible closure of the operation was to be considered.
The group, also home to the Currys and PC World chains in Britain, Elkjop in Nordic countries, UniEuro in Italy and Kotsovolos in Greece, nudged its outlook higher on Thursday after reporting sales at stores open over a year up 7 percent in the fourth quarter to April 30.
That sent Dixons shares, which have already doubled over the last year, up 6%.
However, Pixmania, which operates in France and the Czech Republic, employing about 850, is dragging down the performance of the group as it battles the deeper economic problems that have kept much of Europe in recession for a year or more Reuters reports.
Dixons took full control of the business last August and has since exited from half of the countries in which it operates, closed all its stores, exited non core categories and cut about 700 jobs, as sales plunged 36% in the fourth quarter.
Retail analysts put Pixmania’s 2012-13 losses at over £40 million.
“We certainly would be interested in ways in which we could exit through a sale process,” Finance Director Humphrey Singer told reporters. “I think closure in France is extremely difficult so it is right for us to explore all the other avenues before we contemplate that, but ultimately that is an option.”
Chief Executive Seb James added: “We think it has some valuable assets as well, so we don’t want to just throw things away if we don’t have to.”
Dixons said fourth quarter like-for-like sales rose 13% in the UK and Ireland, where the firm has benefited from the closure of Comet and strong demand for tablet computers.
However, Dixons said underlying profit before tax, for the 2012-13 year was expected to be at the top end of analysts’ forecast range of £75-85 million.
It pointed out that £7.4 million of pension costs were being reclassified as “non-underlying” meaning that the consensus range of expectations would rise to £83-93 million.
“This strong year puts Dixons in the best position it has been in for many years,” said James, highlighting a positive year-end net cash position.
Shares in Dixons were up 2.1p at 38.7p at 0900 GMT, valuing the business at £1.42 billion.
“There is significant future profit opportunity as Dixons continues to gain more than its share of the Comet business and eliminates losses overseas,” said Panmure Gordon analyst Philip Dorgan.