Dixons Store Group (DSG) blamed overstocking of laptops for poor performance at PC World, and sounded a warning for Christmas and the rest of the financial year.
DSG chairman Sir John Collins said: "There is much debate about the uncertain outlook in many of our markets and the economic fundamentals make it difficult to extrapolate trends into the rest of the financial year, accordingly it is appropriate to be cautious about the consumer environment in 2008."
Like for like sales were up five per cent and group profit before tax was down to £52.4m from £70.3m last year.
Total group sales were up eight per cent to £3.3bn and profit before tax was £37.3m, up from £29.8m last year.
Sales in the computing division were up one per cent to £900m, from £887m last year, and underlying operating profit was £5.9m compared to £23.5m last year. Margins were hit by poor laptop sales.
DSG said: "Margins were materially impacted by the need to reduce laptop stocks following lower than expected demand for Vista enabled products, and the effects of increasing hardware in the mix...".
DSG's support service - the TechGuys - had a better year, doubling sales. The service employs 500 field engineers, 450 instore engineers, and 1,500 call centre staff.
DSG's statement is available here (pdf). ®