DSG cuts capital expenditure by £30m

Updated 11.56 Thu Oct 23 2008

Keywords: consumers, shopping, trading, PC World, Curry's, DSG

DSG, Europe's second-largest electrical goods retailer, is to cut capital expenditure by around £30 million as trading conditions worsen.

The owner of PC World and Currys, which runs 1,200 shops and online stores in 28 countries, reported a 7 per cent drop in like-for-like sales for the six months to October 18 - in line with market expectations.

"We're preparing for a poor Christmas, but we don't think it's going to be completely disastrous either" - chief executive John Browett

Chief executive John Browett said: "Assuming the banking system is actually underpinned and we don't get a complete collapse... we don't see any issues with banking covenants.

"We're preparing for a poor Christmas, but we don't think it's going to be completely disastrous either."

DSG shares have plunged almost 90 per cent over the past two years, hit by a downturn in consumer spending and worries over US rival Best Buy's entry into Europe next year.

At the prospect of a global recession, shoppers across Europe have reined in spending amid higher food and fuel costs.