But the group said on Thursday the trading environment in the year to end-February 2010 would be "extremely challenging."
The group said sales at shops open at least a year fell 1.6 percent at Argos and 10.2 percent at Homebase in the eight weeks to February 28.
The Argos figure exceeded analysts' expectations of a fall of about 7.5 percent while the Homebase outcome was in line with their expectations.
The performance compares with falls of 7.5 percent and 10.2 percent at Argos and Homebase respectively for the 18 weeks to January 3.
Gross profit margins at Argos were down 125 basis points, while those at Homebase fell 175 basis points.
Prior to Thursday's update analysts were forecasting a consensus pretax profit of about 320 million pounds for the year to end-Feb 2009. For the following year forecasts are pitched below 200 million pounds.
"Group benchmark profit before tax for the year just ended will meet current market expectations, and our net cash position has increased by approximately 100 million pounds over the year," said Chief Executive Terry Duddy.
"Whilst Argos had a better than expected sales performance in the latest period, the environment for the new financial year will be extremely challenging."
Home Retail said its year-end net cash would be about 274 million pounds and was expected to continue to be sufficient to meet the group's needs.
In addition the retailer has 700 million pounds of undrawn committed borrowing facilities available.
Retailers are struggling as indebted consumers rein in spending amid soaring unemployment, sliding house prices and fears of a long and deep recession. Sellers of expensive, discretionary items are being particularly badly hit.
On Wednesday John Lewis Partnership, the department stores and Waitrose supermarket chain, viewed as a bellwether for Britain's retail industry reported a 26 percent slump in full-year profit.
Shares in Home Retail have lost 17 percent of their value over the past year, a performance in line with the DJ Stoxx European Retail Index.
The stock closed Wednesday at 204 pence, valuing the business at 1.79 billion pounds.
($1=.7267 pounds)
(Reporting by James Davey; Editing by Mark Potter and Mike Nesbit)
LONDON (Reuters)
The group said sales at shops open at least a year fell 1.6 percent at Argos and 10.2 percent at Homebase in the eight weeks to February 28.
The Argos figure exceeded analysts' expectations of a fall of about 7.5 percent while the Homebase outcome was in line with their expectations.
The performance compares with falls of 7.5 percent and 10.2 percent at Argos and Homebase respectively for the 18 weeks to January 3.
Gross profit margins at Argos were down 125 basis points, while those at Homebase fell 175 basis points.
Prior to Thursday's update analysts were forecasting a consensus pretax profit of about 320 million pounds for the year to end-Feb 2009. For the following year forecasts are pitched below 200 million pounds.
"Group benchmark profit before tax for the year just ended will meet current market expectations, and our net cash position has increased by approximately 100 million pounds over the year," said Chief Executive Terry Duddy.
"Whilst Argos had a better than expected sales performance in the latest period, the environment for the new financial year will be extremely challenging."
Home Retail said its year-end net cash would be about 274 million pounds and was expected to continue to be sufficient to meet the group's needs.
In addition the retailer has 700 million pounds of undrawn committed borrowing facilities available.
Retailers are struggling as indebted consumers rein in spending amid soaring unemployment, sliding house prices and fears of a long and deep recession. Sellers of expensive, discretionary items are being particularly badly hit.
On Wednesday John Lewis Partnership, the department stores and Waitrose supermarket chain, viewed as a bellwether for Britain's retail industry reported a 26 percent slump in full-year profit.
Shares in Home Retail have lost 17 percent of their value over the past year, a performance in line with the DJ Stoxx European Retail Index.
The stock closed Wednesday at 204 pence, valuing the business at 1.79 billion pounds.
($1=.7267 pounds)
(Reporting by James Davey; Editing by Mark Potter and Mike Nesbit)
LONDON (Reuters)
