“Tough trading conditions” failed to stop Argos increasing its sales and profit during its latest financial year, it has been revealed.
The retailer, which is owned by supermarket giant Sainsbury’s, has reported a revenue of £4.22bn for the 12 months to 2 March, 2024, up from the £4.15bn it posted for the prior year.
Newly-filed accounts with Companies House also show that its pre-tax profit grew from £27.7m to £37.3m over the same period.
Argo also upped its headcount from 7,045 to 7,731 in the 12 months.
However, the total is far below the 10,272 people it employed at the end of March 2022.
During that financial year, Argos reported a revenue of £4.17bn and a pre-tax profit of £84.8m.
Argos said its turnover for its most recent financial year increased as a result in sales growing in its in-store and collection point sales – a rise that was offset by a fall in sales at its standalone shops.
On an underlying basis, it went from making a pre-tax profit of £69.8m to a loss of £13.4m. For non-underlying items, Argo went from a loss of £42m to a profit of £50.7m.
The company added that it fell to an underling pre-tax loss because of “lower general merchandise margins, reflecting higher promotional sales participation in tough trading conditions and the impact of margins of lower sales in higher margin seasonal categories”.
Sainsbury’s ‘transform’s Argos
For the same financial year Sainsbury’s, which owns Argos, reported a revenue of £32.7bn, up from £31.4bn, while its pre-tax profit fell from £327m to £277m.
At the time, the supermarket giant said its general merchandise sales fell by 0.5 per cent as a result of the closure of Argos in the Republic of Ireland.
It also said that Argo had achieved a “resilient” profit, having “transformed” its operating model in recent years.
Sainsbury’s added: “Through reducing the standalone store estate, opening more Argos stores inside Sainsbury’s and driving greater operating efficiency, we have reduced operating costs by more than three per cent of sales since 2019/20.
“This helped protect profits over the last year, where sales were resilient at a headline level but were skewed towards lower margin consumer electronics and technology categories, with poor weather against tough comparatives impacting sales in higher margin seasonal categories.”