JOHN CLARE, chief executive of DSG International, the owner of Dixons, said yesterday that several of his smaller rivals would go into administration because of tough trading on the high street.

Mr Clare predicted that a number of smaller to medium-sized electrical and computer retailers would “go to the wall”, saying that computer firms and mail order groups would struggle this Christmas. “I do think that there will be some (smaller electrical retailers) going into administration this Christmas,” he said.

His comments came after he confidently predicted that DSG would grab market share and increase margins and sales this Christmas.

Despite revealing sliding sales at the group’s Currys, Dixons, The Link and PC World chains, Mr Clare said that the group was in a strong position to benefit from a general downturn in the electricals market. He said: “Downturns in markets make life tough and a bit difficult, but the strong get stronger and the weak get weaker or go to the wall. They are big opportunities and we are up for it and going for all we can get.”

Currys, Dixons and PC World are winning market share, according to Mr Clare, while The Link, the group’s poor-performing mobile phone store, was still losing ground.

DSG has come under pressure over the past few Christmases as general retailers — including Argos and Woolworths — have devoted shelf space to cheap versions of top-selling Christmas items. This year there is heavy price competition on items such as satellite navigation systems, digital cameras and flat-screen televisions, while fast-selling electronic gadgets such as iPods and PlayStation Portable, the Sony gaming machine, are in short supply.

Yesterday DSG said that underlying sales, which strip out the effect of new store openings, had fallen 3 per cent at Currys and 2 per cent at Dixons in the six months to November 12. Total sales by The Link slumped 21 per cent over the same period, or 28 per cent on an underlying basis. PC World, the group’s computer chain, recorded an 8 per cent slide in underlying sales driven by declines in the price of laptops and home computers.

Mr Clare said that the business had grown strongly overseas. Total sales for the group rose 4 per cent as a result of new store openings, but the poor performance from the UK businesses dragged down underlying sales by 3 per cent. He said that despite strong price competition, he thought that there were unlikely to be heavy discounts before Christmas because retailers had planned for a slowdown in sales and had bought stocks tightly.

DSG has bought slightly less than last year in preparation for a tough Christmas.

Shares in DSG rose by 1½p to 152p on relief that the trend in sales decline had not worsened. Analysts held their forecasts.

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