Troubled high street electrical chain Comet has found itself in the midst of talk of a sell-off as successive sales slumps have marked a decline.
The year didn't start well as French owner Kesa Electricals reported that poor sales at its UK arm impacted on the group as a whole, reporting a like-for-like sales drop of 4 percent between November and January, which was fuelled by a 7.3 percent sales fall at Comet. This month, it was announced that sales fell by 15 percent in the first quarter and this has led to intense media speculation about the future of the chain.
Kesa is reportedly under pressure to sell Comet off as its French chain Darty is doing good business across the Channel, reporting a 5.5 percent increase over the same period. Things are hardly looking promising for Comet, given the tough trading conditions and downgrading of profit forecasts from its competitors such as Dixons Retail.
Kesa has already announced that it will close down between five and ten of Comet's 250 retail outlets, and that's only served to aid Dixons, which reported a share price rise of 13.9 percent on Monday. Kesa, too, saw its own shares rise by 7 percent as speculation of a sell-off has gathered pace. Other plans include reducing its 14 service centres to just two and shutting down one of its three warehouses, with the job losses estimated at around 150.
Should Kesa off Comet, it would be delisted from the London Stock Exchange as the company looks to concentrate on its more successful French operations.
