IT'S A strange beast, GUS. The group comprises Argos, the low- brow retailer, Experian, a credit checking and marketing business, and (77 per cent of) Burberry, the luxury goods chain.
Despite the anachronistic conglomerate structure, its shares had done pretty well over the past couple of years, at least until the start of this summer. No matter how poor the returns from the group's investment in Experian (and they have been poor), Argos has taken care of it.
This time last year, sales at Argos were showing 12 per cent year- on- year growth. Yesterday, a trading update from the group showed the extent to which things have deteriorated. Like-for-like sales growth was 5 per cent in the three months to 30 June.
The decline shouldn't be a surprise, although it spooked the market. Argos is still growing faster than retail spending as a whole, and with the addition of new stores taking the division's sales growth to 10 per cent, the figures are actually pretty robust. But the trend is in the wrong direction, and there is every chance the UK consumer could be about to have a crisis of confidence and cut back on spending. …