DIXONS RETAIL 
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LONDON (Reuters) - Dixons (>> Dixons Retail PLC), Europe's No. 2 electricals retailer, beat guidance with a 15 percent rise in underlying year profit, with sales growth in Britain and northern Europe offsetting falls in the austerity-hit south and at its PIXmania internet arm.
Across Europe many retailers are struggling as disposable incomes are squeezed.
Dixons, European market leader Metro's Media-Saturn (>> METRO AG) and No. 3 Darty (>> Darty PLC) suffered in the economic downturn because they sell discretionary goods and face cut-price competition from supermarkets and internet retailers such as Amazon (>> Amazon.com, Inc.).
On Wednesday Darty reported a 66 percent fall in annual profit.
However, in Britain, where Dixons trades as Currys and PC World, it has benefited from the demise of rival Comet last year and strong demand for tablet computers.
It has also been cutting costs, revamping stores and improving product ranges, prices and customer service.
The group, also home to Elkjop in Nordic countries, UniEuro in Italy and Kotsovolos in Greece, said on Thursday it made an underlying pretax profit of 94.5 million pounds ($148 million) in the year to April 30.
That compares to company guidance of about 93 million pounds and 82.1 million pounds made in the 2011-12 year.
In the UK & Ireland and northern Europe profits rose 39 percent and 6 percent respectively.
Underlying group sales increased 4 percent to 8.2 billion pounds, though gross margin fell 0.7 percentage points, reflecting a higher proportion of sales with lower margins, as well as price cuts.
Dixons did, however, book restructuring and impairment charges of 168.8 million pounds, relating mainly to PIXmania and the main non-store UK B2B operations following the disposal of its Equanet business.
Taking these into account the firm made a pretax loss of 115.3 million pounds versus a loss of 118.8 million pounds last time.
Dixons has said it wants to sell or close PIXmania.
Shares in Dixons which have more than trebled in the past year, closed Wednesday at 42.3 pence, valuing the business at 1.54 billion pounds.
"I look forward to another good year, building on the momentum of this year," said Chief Executive Sebastian James.
He highlighted that Dixons ended the year with net cash of 42.1 million pounds versus net debt of 104 million at the start of the year, saying it marked "an important milestone in our transition from survivor to winner." ($1 = 0.6386 British pounds)
(Reporting by James Davey; Editing by Kate Holton)
