Alba, the consumer electronics distributor for brands such as Goodmans, Grundig and Bush, said yesterday that losses for the past year would be far greater than expected because of fierce competition on the high street.

Shares in the group dived 18 per cent, by 14p to 65p, close to their lowest value since 1990, as Alba said that tumbling prices meant that it was impossible to make money-supplying entry-level flatscreen televisions to leading retailers. Trading losses for the year to March 31 are expected to be £10 million. Investec, the house broker, forecast £6.7 million.

Andrew Rose, Alba's group finance director, said: “We have been in a difficult trading environment for a couple of years, it has become more difficult and we are restructuring accordingly. An entry-level 32in flatscreen TV is £250 to £300 now. I paid £450 for a 15in set four or five years ago.”

Alba's warning came as two more high street retailers collapsed. Toy-zone, a 20 toy-store chain with 200 staff, asked KPMG as administrator to find a buyer after suffering from the Nintendo Wii gaming phenomenon at Christmas. And Sleep Depot, a bed chain with 71 concessions in Land of Leather stores, has filed for administration. Nearly a dozen mid-market retailers have gone to the wall since Christmas, including Dolcis, the shoe store.

Alba is in the middle of a restructuring drive to focus on higher-margin products and to sacrifice sales in low-margin areas, such as the more basic, entry-level products, after making losses of £29.6 million last year.

Mr Rose said that the restructuring effort would be stepped up, with stocks cut and about 20 staff losing their jobs. A further 60 will be transfered to UPS under an outsourcing deal in which the mail delivery company will run Alba's logistics centre in Cortonwood, South Yorkshire, for a minimum of three years.

Alba distributes a range of consumer electronics such as televisions, set-top boxes and radios to high street retailers such as John Lewis and Currys as well as the big supermarkets. Mr Rose said that as well as constant pressure on margins, the group was finding that some customers were bypassing Alba and going direct to the manufacturers for the more basic products.

Prices for flatscreen televisions have tumbled by nearly 30 per cent in the past year. Sainsbury's said that flat-screen televisions were one of its best-selling items over Christmas and the new year. Sony, the Japanese electronics maker, has replaced the head of its loss-making television unit in a bid to turn around the business. The unit lost $601 million (£304 million) in the six months to last September after being hit by savage price cuts.

Mr Rose added: “There is pricing pressure from all stores. Entry-level products have become commodities and therefore it has become an area where it is difficult to make a profit.

"We are concentrating on those areas where we can add value and focusing on what we think will be popular in a year's time, as opposed to something you can pick off a shelf now.”

In Focus

— Alba was a former trademark of the radios and televisions produced by AJ Balcombe Ltd, which was formed in 1917 by Alfred Balcombe and went into receivership in June 1982.

— Based in Elstree, Hertfordshire, the company employs 220 people and is one of the largest suppliers to Argos.

— Its brands include Goodmans, Bush, Hinari, Ministry of Sound, Grundig and Roadstar.

— The company sold its 50 per cent stake in Grundig for £25 million in December 2007, but will retain the UK rights to the brand for the next three years.

— Alba shares closed down 17.8 per cent yesterday

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