Electrical goods chain Comet suffered a heavy loss of £8.1m in the first half of the current financial year.

Comet had registered very impressive performance last year, making £10.6m profit. This year its like-for-like sales also slumped by 11.6% in the six months ending October 31. The group owner, Kesa Electricals, described company’s condition as very difficult.

Comet has met a fate similar to rival DSG International which went into red after PC World and Currys posted losses of £30m two weeks ago.

Kesa has slashed their interim dividend by 50% and warned that no improvements were being expected in the remaining second half of the year due to weakest economic climate across Europe.

Comet, the seller of ‘big-ticket’ furniture and white goods and a chain of 252 stores, has been badly hit by the crashing housing market and lower consumer confidence. Extremely aggressive market conditions dented its margins.

Losses would have been substantially high if it had not taken drastic cost-saving measures such as 300 job cuts and shifting of regional distribution centre. Comet employs 8,500 full-time staff in the UK.

Overall profits of the group fell to £13m from £45.1m. Shares plummeted more than 10%. Analysts have started slashing their forecast after going through the gloomy update.

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