Retailer Currys rises on profit beat; warns of uncertainty this year

(Reuters) -British electricals retailer Currys beat annual profit expectations on Thursday, sending its shares up 10%, and said it would cap prices of dozens of products to win market share as consumers cut spending.

It reported adjusted pretax profit of 186 million pounds ($223 million) for the year ended April 30, topping the 152 million forecast by analysts.

The London-headquartered retailer, which sells a wide range of products from mobile phones to refrigerators, forecast a 2022-23 profit of between 130 million and 150 million pounds citing uncertainty about consumer spending.

Despite forecasting lower profits and margin pressures, Currys said it expects to continue generating cash this year.

“Inflation is very likely to create a headwind to consumer spending and impact sales, particularly in some of our more discretionary categories,” CEO Alex Baldock said in a statement.

“Markets seemed poised for hefty guidance downgrades, so whilst Currys expects medium-term margin growth to slow, the fact there might be growth at all is being rewarded,” Hargreaves analyst Matt Britzman said in a note.

Rival AO World, which in April also warned on profits this year, said on Wednesday it would raise 40 million pounds in new equity to bolster its finances after its stock took a tumble this week on cash crunch fears.

($1 = 0.8350 pounds)

(Reporting by Radhika Anilkumar in Bengaluru; editing by Rashmi Aich and Jason Neely)