Home Retail, Britain's biggest household goods retailer, today said quarterly sales at its main Argos business fell, blaming waning demand for key electrical goods such as televisions and tablet computers.
Sales at Argos stores open for more than a year fell 3.9% in the 13 weeks to May 30, its fiscal first quarter.
That compares with analysts' consensus forecast of a decline of 3.7%, and a 5% fall in the final eight weeks of the 2014-15 year.
Home Retail had cautioned in April that first half sales at Argos would likely decline this year as it works through revamps to the business and battles weaker demand for televisions, computers and tablets.
The group, which also runs do-it-yourself chain Homebase, is transforming its larger, more profitable Argos arm from a catalogue-based retailer into a digital business.
It is now targeting higher sales from mobiles and tablet PCs and making collections faster and easier.
Argos' total sales fell 2.6% to £846m, with internet sales representing 44% of that total.
"We continue to expect that sales will be challenging during the first half at Argos, but we look forward to a stronger second half as we progress the transformation plan and introduce new propositions more broadly to the market," the company's chief executive John Walden said.
Like-for-like sales at Homebase rose 5.4%, much better than analysts' average forecast of a 0.8% fall, helped by growth across big ticket and seasonal categories as well as stock clearance sales related to the business' store closure programme.
Total Homebase sales fell 1.6% to £438m.