Currys Interim Results: What to Watch

Currys (LON: CURY) is set to report its interim results this week on Thursday, December 12, with investors eager to assess how the electronics retailer is navigating various headwinds and changing consumer habits.

A recent downgrade by Deutsche Bank highlighted concerns about rising costs following the Autumn Budget.

Investor attention will be on how Currys balances the challenges. Deutsche Bank, which cut Currys to Hold from Buy, stated: “As retailers reach for levers of price and cost control, we view some as much better positioned than others.” 

However, the bank's re-rating of the electronics retailer is due to their “caution on the scale of the budget impact, both the magnitude of cost inflation and potential for return of category spending.”

Meanwhile, in its previous trading update, the company noted strong sales, with like-for-like revenue rising by 5% for the 17 weeks ended August 24, 2024.

They said that “new AI-enabled computers are bringing excitement and innovation to customers.” Those customers were said to be going in-store to learn more about the technology, helping Currys to “take almost 50% share of the total laptop market.”

Whether the like-for-like sales momentum carried through to the holiday season and Black Friday sales remains a key question.

However, the Nordics, where like-for-like revenue dropped by 2%, continues to lag. While the operating costs were tightly controlled, investors will be hoping for an improvement in the region.

Looking ahead, the retailer maintained its full-year guidance, saying it is confident in its expectations for profit and free cash flow growth, while its balance sheet is expected to remain in a healthy net cash position.

The company's CEO, Alex Baldock, commented in its previous update that they are “continuing to target growth in high margin, recurring revenue services and solutions.”

He added: “Currys is well set for our important Peak trading period and beyond.”

Finally, another potential point to watch out for is dividends. Some analysts have noted that Currys has previously hinted at reinstating its dividend payments, a move that could reflect confidence in its financial health.