Currys price hikes 'inevitable' after £32m Autumn Budget hit
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Looming Currys price hikes are 'inevitable' ahead of a £32million hit from changes announced in the Autumn Budget, the retailer told shareholders on Thursday. Currys said 'some' price hikes are on the way as it detailed £12million of additional national insurance contributions and £9million in new staff costs linked to National Living Wage increases.
The retailer is the latest business to lash out against the changes, which have led to warnings of higher prices, store closures and job cuts when they come into force from April next year. Currys chief executive Alex Baldock slammed 'new and unwelcome headwinds from government policy', which he said would 'add cost quickly and materially, depress investment and hiring, boost automation and offshoring, and make some price rises inevitable'.
In addition to the direct financial hit from changes to employer national insurance contributions and the national minimum wage, Currys said it will see a £9million impact from 'the pass through of these costs from some of our outsource partners'. It also faces a £2million increase from the inflation-based increase in business rate taxes, Currys said.
Currys says it will face an additional £32m in costs as a result of changes to the Autumn Budget. But additional cost headwinds failed to dampen investor enthusiasm as Currys shares soared 12.2 per cent to 88.65p, bringing one-year gains to almost 95 per cent.
However, the shares are down by around 40 per cent over the last five years. It came as the group reported 2 per cent like-for-like half-year revenue growth to £3.9billion, as 6 per cent growth in the UK and Ireland offset continued decline in the Nordics.
