Britons shun new computers and TVs in cost-of-living crisis

Britons spent big on energy efficient appliances in the Christmas trading period but avoided computers and televisions as they battled a cost-of-living crisis, electricals retailer Currys said on Wednesday.

The group said like-for-like revenue in its UK and Ireland business fell 5% in the 10 weeks to Jan. 7, partly reflecting high levels of sales seen over the last two pandemic-hit years.

But it kept its financial guidance for the full year, sending its shares up 8% in morning trading, paring losses over the last year to 38%.

“It hasn’t been a bumper peak trading season for technology retail, for example the computing and the TV markets were in quite a challenging space,” Chief Executive Alex Baldock told reporters, noting that demand for smart technology was also soft.

“By contrast we did well in (domestic) appliances and in mobile,” he said, highlighting particularly strong demand for energy efficient appliances.

He said sales of air fryers were up 500% year-on-year, while microwave sales were up 30%. Sales of heat pump tumble dryers and energy efficient washing machines were also strong.

“In many cases customers were actually trading up to more expensive washing machines in contrast to computers for example where many customers were trading down to less expensive laptops,” he said.

He said demand for TVs did not get a boost from the soccer World Cup.

“(In) TVs we haven’t seen the replacement (cycle) kick-in to the extent that we might have done in more affluent times,” he said.

Last month, Currys reported an underlying first half loss and cut the profit outlook for its full 2022-23 year, blaming a slowdown in its Nordic markets which are seeing unprofitable pricing by competitors.

On Wednesday, Currys highlighted a further deterioration in trading at the Nordics business.

It said profits in the UK and Ireland business were better than forecast thanks to gross margin increases and cost savings.

But international profits were below forecast, reflecting a 10% sales decline in the Nordics business and continued pressure on gross margin.

The group said it still expected to deliver 2022-23 adjusted profit before tax of 100-125 million pounds ($123-$154 million), down from 186 million pounds made in 2021-22.

($1 = 0.8110 pounds)