Electricals retailer Currys cut its full-year profit outlook on Thursday as it said it swung to a loss in the first half after its international business took a hit due to heavy discounting from competitors.
In an update for the half to 29 October, the company said it now expects 2023 adjusted pre-tax profit of between £100m and £125m, down from previous guidance of £125m to £145m on a like-for-like basis.
During the half, Currys swung to a statutory pre-tax loss of £548m from a profit of £48m in the same period a year earlier, and to an adjusted pre-tax loss of £17m, versus a profit of £45m. Revenues declined 7% to £4.5bn.
Currys said its performance in the UK & Ireland strengthened again, but the international segment was hit by temporary market disruption, as competitors discounted excess stock heavily.
Chief executive Alex Baldock said: “Our international business, which has consistently delivered growth in sales and profits over many years, has had a difficult first half with margins sharply down. Lower demand has left domestic competitors with excess stock, which they’re now heavily discounting.
“This has substantially disrupted the market, and required margin investment to keep our sales strong. We expect these pressures, intense though they are, to be temporary – demand will normalise, excess stock will wash through, and competitors will find unprofitable aggression hard to sustain. We’ve also stepped up our self-help actions on margins and cost.”
