Home Retail Group has seen its profits slashed by a quarter, as the recession hits its Argos and Homebase brands.
Profits at the group fell to £328m for the year to February 28th. However, the group recorded a loss of £402m due to write downs of £694m and what it described as 'onerous' lease charges.
Total group sales fell to £5.9bn, with like for like sales at Argos falling by 4.8 per cent. Gross profit margins at the retailer were also heavily hit, down 100 points.
"In a particularly difficult trading environment, we have managed our costs and cash very effectively to limit the impact on profits," said Home Retail Group chief executive Terry Duddy.
He was confident that those actions would put the retailer on a stronger footing in the next year: "This focus has put us in an even better position to trade through another tough year while further improving our competitive position.
"We will continue to develop our broad product range, benefit further from our advantaged sourcing operations and invest in our multi-channel operations in order to strengthen our position as the UK's leading home and general merchandise retailer."