Comet parent weighing up options over retailer's future

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Comet parent weighing up options over retailer's future

Simon Quicke
The future of Comet could become clearer as its parent looks to get the struggling retailer back on track to get the best outcome for shareholders.

In the medium-term its likely to include some restructuring to get profitability back into the business but Kesa has indicated that a sell-off could be the long-term solution.

The talk of "strategic alternatives" for Comet emerged in the latest statement from David Newlands, the chairman of Kesa, which accompanied its financial results.

For the year ending 30 April the Kesa Group made a 2.3% increase in pre-tax profits to €93.2m and saw revenues go up by a similar percentage margin to €5bn.

But the numbers were not so good when the spotlight fell on Comet with the retailer producing a loss of €10.3m on a revenue of €1.8bn, slightly down on the year before.

"We have a strong turnaround plan for Comet to restore its profitability in the medium term and in parallel we are examining strategic alternatives to ensure the best overall value for shareholders," said Newlands.

After a strong Q1 the financial year declined and the retailer, with operations across the continent including Darty in France, is braced for those tough conditions to continue.

"We anticipate all our markets will be challenging for the current financial year, particularly in the first half against the World Cup comparatives of last year," he said.

"However from improved market positions in most of our markets, further cost measures in all countries with specific restructuring at Comet, BCC and Darty Spain and the strength of our cash generation and balance sheet, we are well prepared for these conditions," he added.
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