Electrical retailer Dixons said it made an 'encouraging' start to the year with decent growth in the UK, Ireland and Northern Europe, though trading in Southern Europe continues to be tough.

Total group sales in sterling terms were up 2% year-on-year in the 12 weeks to July 21st, up 8% on a local currency basis. On a like-for-like (LFL) basis, sales were 5% higher.

"While it is still early in our financial year, I am encouraged by the start we have made across the group.  We have had a real boost from a busy summer of events in the UK and our Northern European operations continue to go from strength to strength," said Chief Executive Sebastien James.

"August has proven to be quieter across the retail sector in some of our markets and we continue to be cautious about the outlook. However, we are well placed for the back to school period and look forward to the launch of Windows 8 and the exciting new products that we will have available for customers for the Christmas period," he said.

LFL sales in the UK & Ireland jumped 7%, while LFL sales in Northerm Europe were 13% higher, as the group was able to maintain the decent growth rates seen in the fourth quarter of last year.

However, the rate of LFL sales decline worsened to 10% in the first quarter (from 9% in the fourth quarter) in the Southern European regions (Italy, Greece and Turkey). Dixons said that its Italian and Greek businesses are taking "appropriate actions in continued difficult economic environments."

Last month, the company acquired full control of the electrical online retailer PIXmania, buying up the remaining 22% interest that it did not already own for €10m (£8m) in cash. However, the firm said on Thursday that trading at the unit continued to be "challenging" in the first quarter.

"I am pleased that we now have day to day control of PIXmania allowing us to take the decisive actions necessary to improve its performance," James said.

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