Currys has posted a half year loss as its chief executive warns that the tough retail environment is set to continue.

In the six months to 29 October, the electricals and appliance retailer reported a group adjusted pre-tax loss of £17 million compared to a profit of £45 million at the same time last year. On a statutory basis, group pre-tax losses came in at £548 million, which Currys said was mainly driven by a non-cash goodwill impairment of £511 million that stemmed from its merger with Dixons Carphone in 2014.

Meanwhile, group sales declined by 7% and by 8% on a like-for-like basis.

Alex Baldock, Currys group chief executive, said: “Currys UK&I performance continues to strengthen, and is showing real momentum, reflecting good progress in our transformation. International, however, has had a tough period, and faces short-term but intense pressures from a disrupted market.

“Of course, our customers are feeling real cost of living pressure and our job is to help them get hold of the technology that’s more essential to their lives than ever. We’re doing that, through our price promise, giving customers access to responsible credit, and offering more products that save them money through lower energy costs. Our Go Greener range is flying off the shelves.”

Currys said trading in the six weeks since the period end has been in line with the first half. The group said it is now expecting full year adjusted pre-tax profit to come in at between £100 million and  £125 million, assuming no further unexpected macro deterioration. This compares to a previous guidance of £125 million to £145 million on a like-for-like basis, after adjusting for the reclassification of £5 million worth of IT spend.

Baldock added: “It’s a tough environment, and we are planning for that to continue. Still, we expect to maintain the trajectory of improving UK&I profitability and a robust recovery in international profits. Our ever-improving customer experience and strong services give us confidence in improving margins. And we will continue our excellent progress on cost efficiency.”

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