Currys issues warning to shoppers over new 'rules' from April
Currys has issued a warning over new rules from April. The retailer, which has stores in and around Birmingham, has warned over the new Labour Party government's incoming National Insurance rules and shake up from Chancellor Rachel Reeves.
The electrical goods chain also says it intends to bring in more automation, despite the market ‘perking up’ over Christmas. Currys has said it will pay dividends to shareholders for the first time in two years, too, in a trading update.
It comes after underlying sales rose 2% in the UK and Ireland and 1% in its Nordic stores. Alex Baldock, the Currys chief executive, said the company expected to achieve profits of up to £155m in the year to the end of April – £5m to £15m more than previously forecast.
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“Our market was slightly down in the year to date but it perked up a bit during the peak [Christmas period],” he said. “There are several things depressing sentiment – inflation, interest rates and general confidence – but there are some signs we are past the trough of consumer confidence and spending, with inflation having peaked and interest rates going to come down.”
Baldock said Currys faced £30m in extra costs from changes to the national insurance rules. He said “some price rises are inevitable” but Currys did not plan to lead the way and instead hoped to find ways to “mitigate as much as we can”. He said the national insurance change “depresses hiring and boosts automation and offshoring”.
Baldock said Currys did not have plans to cut jobs but there would be a period of “depressed hiring”. John Moore, a senior investment manager at RBC Brewin Dolphin, said: “It’s been a tough seven days for UK retailers, but Currys is managing to buck the trend, buoyed by AI products and a more general increase in tech spending. The company is a classic slow-build, self-help story, with sales on the rise, growing market share, and profits heading in the right direction.”