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UK's Currys announces share buyback after robust sales

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LONDON (Reuters) - British electricals retailer Currys said strong demand for tech products pushed its six-month sales up 15% compared with the same period before the COVID-19 pandemic, enabling it to launch a $100 million share buyback.

Analysts said the results showed the company previously known as Dixons Carphone was entrenching its market leading position ahead of the key Christmas trading period, and its shares rose 8%.

The group, which trades from 829 stores in seven countries and online, has proved resilient during the pandemic, benefiting from people buying equipment for working from home and for leisure, such as gaming. Its shares are up 30% in a year.

Trading in the Nordics under the Elkjøp brand and as Kotsovolos in Greece, it said organic group sales were up 15% on two years ago.

The company now expects to deliver a robust peak trading season, and said it had put in place measures to mitigate supply chain disruptions that have affected many business around the world as economies reopen from the pandemic.

It reiterated its consensus forecasts for full-year pretax profit of 161 million pounds ($220 million) and also reiterated medium-term goals. It said for the full year 2021/22, its capital expenditure would be 20 million pounds below a previous guidance of 190 million pounds.

"Sales were very strong at the start of the period as we saw pent up demand from customers choosing to shop in stores after extended lockdowns but strong two-year growth has continued through the summer and into the autumn," it said of its UK electricals sales.

The launch of a 75 million pound share buyback came as it said it would finish the year with 100 million pounds of net cash, and after it resumed its dividend.

"While we prudently model the buyback for one year, the group's balance sheet strength can support an ongoing programme, which alongside the dividend should provide support for the share price which we see as far too cheap, whichever way the current valuation is cut," analysts at Liberum said.

(Reporting by Kate Holton; editing by James Davey and Christian Schmollinger)

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