A surge in demand for consumer electronics buoyed catalogue business Argos after it reported a seven per cent rise in like-for-like sales.
The chain's owner GUS said shoppers snapped up flat screen televisions and set-top boxes in the run-up to the World Cup, but added that some of the growth had been offset by the impact on margins caused by promotional offers.
Announcing figures for the three months to June 30, GUS reported a five per cent fall in like-for-like sales at Homebase, which has suffered from the weak DIY market.
GUS chief executive John Peace said he was pleased with progress at the retail arm, Argos Retail Group, as well as the company's Experian credit checking business. Argos and Homebase make up ARM which GUS plans to split from Experian.
Experian, which is due to be spun off into a separate company later this year, maintained its recent strong growth with a 21 per cent rise in sales, helped by the impact of acquisitions such as the 2005 deal for LowerMyBills.com.
Mr Peace said: "Both businesses have clear strategies for growth, putting them in good shape for their future as independent companies."
New store openings, including six in the first quarter, meant the total increase in Argos sales during the quarter stood at 14 per cent.
As well as flat screen televisions, Argos saw good sales growth in bedroom furniture, photography and video game systems.
However, GUS said the sales lift was "substantially offset" by a reduction in margins compared with a year earlier.
It added: "This was driven by the shift in the product mix and by the popularity of Argos' promotional offers in the quarter, partially countered by the benefits obtained from ARG's supply chain initiatives.
Argos Direct, the delivery to home operation, grew sales by ten per cent and now accounts for 25 per cent of revenues at the catalogue chain.
Margins improved at Homebase as GUS said it reduced the amount of promotional activity on a year ago. Adding in the impact of new selling space, sales at Homebase decreased by one per cent.
Sales from continuing operations at Experian were up 23 per cent in the three months to June 30.
Mr Peace said: "We are pleased with the progress of both ARG and Experian in the first quarter of our new financial year, each of which is trading in line with expectations."
Shares closed up 1p at 9901/2p.