The owner of this once iconic brand, Home Retail , is expected to turn in disappointing figures next week, after the shares have fallen by over 50% this year.

Home Retail: AlphaValue downgrades from buy to reduce, target cut from 151.1p to 108.8p.

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Indeed!

Financial highlights
§ Sales down 6% to £5,492m
§ Cash gross margin down 7% to £2,027m
§ Robust management of costs with operating and distribution costs broadly flat at £1,930m, with the impact of both underlying cost inflation pressures and the investment in new initiatives having been offset by further cost savings
§ Benchmark operating profit1 down 61% to £98m; Group operating margin of 1.8%
§ Benchmark profit before tax2 down 60% to £102m
§ Basic benchmark earnings per share3 down 59% to 8.7p
§ Closing net cash position at 25 February 2012 of £181m
§ Full-year dividend of 4.7p; no final dividend recommended
§ For the 53 weeks to 3 March 2012, sales down 5% to £5,583m and benchmark profit before tax2 down 54% to £116m. Reported profit before tax of £104m. Reported basic earnings per share of 9.1p. Closing net cash position at 3 March 2012 of £194m. The 53rd week contributed £14m of additional benchmark profit before tax2 and £13m of additional cash.

Oliver Stocken, Chairman of Home Retail Group, commented:

"While the Group's performance in the short term cannot be immune from the economic environment, we continue to focus on its strategic advantages to ensure that it will be well positioned for the economic recovery over the long term. Against this economic backdrop, the Board has decided not to recommend a final dividend this year and therefore the full-year dividend is represented by the interim dividend of 4.7p. Future dividends will be set at a level which is sustainable and which reflects the trading prospects and financial position of the Group."

Some big-name retailers will release figures this week, starting with an interim management statement from Home Retail Group on Tuesday. Home Retail, which owns the well-known Argos and Homebase outlets, released a pretty dreadful set of full-year results last month, and canceled its final dividend.

To add to trading woes, the company's managers decided to spend lots of cash on a share buyback in the hope of boosting the share price, but the timing proved disastrous as the price carried on sliding. The slump has seen the shares fall from a 2009 peak of 329p to just 72p today. Recovery investors will be looking for signs that the bottom might have been reached.

Tuesday June 19 =

Quarterly trading is expected to pretty terrible for Home Retail group , which owns Argos and Homebase. The DIY and garden retailer is likely to have been hit very hard by the terrible April weather, which knocked its rival B&Q for six earlier this month. Trading at Argos is unlikely to have turned around, though analysts hope that a small increase in television sales ahead of the summer of sport might have helped a little. JP Morgan is forecasting that like-for-like sales at Argos will have fallen by 5pc and at Homebase by 8pc.

Home Retail Group plc

Interim Management Statement



Home Retail Group, the UK's leading home and general merchandise retailer, today publishes an Interim Management Statement covering the 13 weeks from 4 March to 2 June 2012.



Terry Duddy, Chief Executive of Home Retail Group, commented:



"Over a particularly volatile trading period, Argos had a solid start to the year supported by its multi-channel performance, while at Homebase the poor weather conditions adversely impacted seasonal product sales. At this early stage of the financial year we are comfortable with current market expectations for full year benchmark profit. We will continue to plan cautiously, managing robustly both the cost base and the cash position of the Group while prioritising our investment in the ongoing development of our multi-channel capabilities."









Argos







Sales


£819m



Like-for-like change in sales


(0.2%)



Net space contribution to sales change


0.4%



Total sales change


0.2%



Gross margin movement


Down c.25bps












Homebase







Sales


£421m



Like-for-like change in sales


(8.3%)



Net space contribution to sales change


0.2%



Total sales change


(8.1%)



Gross margin movement




http://www.moneyam.com/action/news/showArticle?id=4390851

Recovering well, up 3.5%

Argos owner Home Retail Group, reporting next week, might also have done well, but questions remain for the retailer.

Rumours that it was seeking a restructuring of the Argos chain have been quietly dismissed. But many analysts believe it cannot continue with so many stores.

Terry Duddy has been chief executive of Home Retail for six years but some sources suggest it may be time for a changing of the guard in favour of newly appointed Argos boss John Walden.

Home Retail was making gains after Investec (Frankfurt: A0J32R - news) upgraded its rating on the stock from 'sell' to 'buy', saying that shares should react positively "to evidence of more resilient trading at Argos" after the group's second-quarter trading update next week.

over 96p

Home Retail: UBS upgrades from neutral to buy, target lifted from 90p to 115p

13 September 2012

Argos sales growth boosted by tablet computers

Argos parent sees shares surge
Argos has returned to sales growth, led by the popularity of tablet computers and e-book readers, owner Home Retail Group (HRG) has said.



http://www.bbc.co.uk/news/business-19582844

Sold my holding

You do relise theres a div to be had in nov i think.,.

Bb made a good profit. A couple of new comps I want to invest in in the next week.
In and out now within reason seems to be working well for me. Cheers Bb.

Home Retail Group the troubled owner of Argos and Homebase, is due to release interim results on Wednesday 24 October. It's been through the wars over the past couple of years -- no sooner had it managed to put a stop to the slide at Argos, than bad weather hit Homebase sales, which were down 6.2% at the time of the firm's Q2 statement on 13 September.

The shares have slipped by around 20% over the past 12 months, to 90p, and are way down on their £4 levels of 2008. But even after that, they don't look cheap by traditional measures -- they're on a P/E of over 15, with a dividend of a fairly modest 3.5% expected. The current glitch at Homebase was beyond the firm's control, but we really should want to see, over the next six months, that the rot really has been halted, and look for some evidence of an upswing in business

Home Retail Group (HOME) is expected to report another big fall in profits when it announces its interim results on Wednesday.

Recent news: The first and second-quarter trading statements hinted that first-half sales and gross profits would be down. Management comments also suggested costs would be reduced.

Last year, Home Retail's pre-tax profits fell from £103 million to £28 million.

Analysts' expectations: The consensus forecast is for first-half pre-tax profits to come in at £14 million.

Philip Dorgan, analyst at Panmure Gordon, is cautious about the upcoming Christmas trading period due to "tough" competition and pricing. He stresses that Argos has too many branches and needs to embark upon a substantial store closure programme.

"Because Home Retail has cash of around £200 million, it is under no immediate financial pressure. This also means that Argos could trade at a loss for some time," he points out. "This is the good news, but it is not enough for us to buy the shares, nor is a less-bad-than-feared second-quarter."

"Both of its operating companies still have fragile profits and losses and we think that Argos requires significant store closure, major cost reduction and brand repositioning. We believe that the risks therefore remain very much on the downside."

Valuation: The stock is trading on a 2012 PE ratio of about 16 times.

Questor share tip: Home Retail's valuation is too high to buy
By Garry White | Telegraph – 2 hours 40 minutes ago.. .

.HOME RETAIL GROUP

Home Retail Group (Other OTC: HMRLF.PK - news) has unveiled it new strategy to boost profits at Argos. The plan is sound, but the valution is too high to buy the shares right now. Questor says avoid.

Home Retail Group 112p Questor says: AVOID

Home Retail group, the owner of Argos, has unveiled plans to return to profit growth at the high-street chain. The market took the news very well.

The company plans to increase its customer base, by repositioning Argos’s channels for a digital future. It’s bye-bye to the catalogue and hello WiFi enabled stores and iPad ordering. After significant investment in IT, management are targeting £4.5bn of sales in 2018, compared with £3.9bn now a mid-single-digit operating margin. A total of 50 stores will be closed and 25 repositioned.

Management has committed to spending £175m a year over three years and expects to see restructuring costs of £50m a year. However, Terry Duddy, chief executive, tells Questor he expects to do this with the company’s own funds.

By the year end, Mr Duddy expects to have around £300m in cash on the balance sheet and the group has recently implemented better cashflow management, which should strengthen cash conversion. The group also has a loan book of about £450m, so could potentially securitise this should it need more cash

There is no doubt that the new direction is ambitious, but it is certainly achievable. The plans appear to imply like-for-like sales growth of about 3pc at the Argos chain. However, trading is very tough at the moment.

The interims released alongside the strategy review, saw like-for-like sales at Argos rise just 0.6pc and this was from a low base. Same-store sales in the equivalent period of 2011 fell by 9.1pc. Total (Brussels: FP.BR - news) pre-tax profit at the group, which also owns Homebase, fell 37pc, with Argos operating profit down 3pc.

The shares have surged by 60pc in the run up to the strategic review and are now trading on a February 2013 earnings multiple of 18, falling to 16 in 2014. This is a heady rating when compared with Dixons Retail (Other OTC: DSITF.PK - news) , which trades on a multiple of 15, falling to 10.5. Essentially, the valuation is pricing in a near-perfect execution of the new strategy.

There is no doubt that Mr Duddy’s plan is correct that’s why investors have propelled the shares to such a high rating. However, any missteps or deterioration in the consumer backdrop will be punished. On valuation grounds, avoid.

Argos and Homebase owner Home Retail (LON:HOME) has been feeling the biting wind of competition blowing from the Internet, as well as High Street rivals such as Tesco and Dixons.

The group makes its third quarter (Q3) trading update, covering the 18 weeks from September to December.

“For Argos … we forecast 3Q LFL sales growth of only +0.5% with a gross margin hit of -60 basis points (bps), predominantly due to an adverse sales mix along with some price investment. We believe the consensus LFL sales estimate for Argos is around 0.3% with a wide range of -2.5% to 2% and consensus gross margin estimate is c. -50bps, with a range of -75bps to 25bps,” reports Caroline Gulliver, the retail analyst at Espirito Santo.

For Homebase, Gulliver forecasts a 1.5% decline in LFL sales for the third quarter.

“We believe the consensus LFL sales estimate for Homebase is -2.3%, with a wide range of -4.2% to +1%. We are forecasting gross margin of +25 bps, with consensus c.-25 bps with a range of -100 to +50bps,” Gulliver revealed