* French Q3 to Jan underlying sales up 4.9 pct vs 5.8 growth
* French Christmas, winter sales were good - CEO
* Economic climate to stay difficult amid price pressure
* Shares up over 2 percent
(Adds details, CEO comments to Reuters, shares)
By Dominique Vidalon
PARIS, Feb 6 Darty Plc, Europe's
third-largest electricals retailer, scored robust Christmas
sales growth in its core French market and plans to seek cost
savings in a challenging economic climate with fierce price
"We are doing an excellent quarter despite a difficult
French market, confirming the performance of the previous
quarter, with very nice Christmas and winter clearance sales,"
Chief Executive Regis Schultz told Reuters in a phone interview.
Sales at Darty France, which represents 70 percent of group
revenue, rose 4.9 percent in the quarter which ended on Jan. 31,
beating the domestic market, which fell 1.3 percent, Schultz
This compared with a sales rise of 5.8 percent in the second
quarter and a decline of 0.4 percent in the first quarter.
In France, Darty made market share gains in all major
product categories, notably tablets, smart phones, or small
domestic appliances, but television sales volumes were still
down though their rate of decline moderated.
Business benefited from VIP private shopping evenings in
late November and early December, a voucher campaign on white
goods after Christmas, and winter clearance sales in January.
The first day of the winter sales saw revenue up nearly one
third compared to the same day a year-ago both in store and
online, Schultz said.
Overall for the quarter web-generated sales grew over 10
percent to over 14 percent of total French product sales.
At group level, Darty reported a 3.2 percent rise in
like-for-like revenue while overall gross margin was down 80
basis points, reflecting ongoing price pressure in "challenging
and promotional markets", it said in a statement.
Darty, which has now completed its head office restructuring
in France to improve cost efficiency, has a goal to deliver
annual gross cost savings of 50 million euros by 2014/15, which
should help limit margin pressure from price cuts.
Like its larger rivals - Metro's Media-Saturn and
Dixons Retail - Darty is facing weak consumer spending
and price competition from online retailers.
London-listed Darty, which has more than 400 stores in
Europe, has responded by cutting costs, exiting loss-making
operations in Italy and Spain, and focusing on its core markets
of France, Belgium and the Netherlands.
Activist investor Knight Vinke, which owns 25 percent of
Darty and has a seat on its board, has been pushing the company
to accelerate the pace of change.
In December, Darty said it had agreed to sell its Turkish
business under a plan to eliminate losses in non-core markets
and was in talks to buy French multimedia website Mistergoodeal.
Darty also continues to review its Datart business in the
Czech Republic and Slovakia, but has not yet taken a decision on
the future of these operations, Schultz said.
By 0855 GMT, Darty shares gained 2.16 percent, extending
gains of 8 percent so far this year, and outperforming a
European retail sector, which was up 0.47 percent.
(Reporting by Dominique Vidalon; editing by Jason Neely and