Electricals group Kesa said it expected its flagship UK chain to slump into the red amid growing woe on the high street.

Kesa said Comet was likely to make "a small loss" in the first half.

It said Comet's turnover fell by 1 . 6 per cent to £316.7 million in the three months to April 30 as soft trading at the start of the year continued in the period and worsened in April.

The like for like decrease was even worse at 2.2 per cent.

Particularly poor sales of white goods such as fridges had significantly affected margins, although sales of digital products continued to be good.

Chief executive Jean-Noel Labroue said the group's French electrical retailer Darty and its other continental European businesses had achieved satisfactory sales in the quarter.

But he added: "Comet's performance in the first quarter reflects the difficult market conditions in the UK.

"The company has already reduced its cost base and will take further action if these conditions persist."

Details of what this action might be were scant, but the company is likely to continue cost-cutting in areas such as back office and home delivery.

As well as Comet and Darty, Kesa owns French furniture retailer BUT, Dutch electrical-chain BCC, Belgian electrical-retailer Vanden-Borre, Czech and Slovak electrical-group Datart and Darty Italy. Comet has 250 stores, Darty has 204 and BUT

104.

Kesa had warned in March of more challenging UK trading after reporting that Comet - the UK's second biggest electricals retailer - had performed ahead of its rivals in the financial year to January 31, lifting operating profits by

9.7 per cent to £52 million. Overall, pretax profits before exceptional items rose eight per cent to £193.7 million.

The group said yesterday that its overall turnover in the three months to April 30 grew by 5 . 6 per cent to £866.7 million.

Turnover at Darty lifted by

8.1 per cent to £340.9 million as continued strong sales of new technology goods helped to offset weak sales of white goods. Total store turnover at BUT grew by 12.9 per cent to £132.5 million, helped by weak comparatives from last year and the delay of the January sales period into February. The group said an overhaul put in place at the end of last year was progressing well.

Turnover at the company's other businesses lifted by 15.6 per cent to £76.6 million.

Its new venture in Italy was on schedule, with two stores opened during April and a further three stores to be opened by the end of July.

Mr Labroue said: "At BUT, the action plan put in place at the end of last year is being implemented successfully by the new management team and our plans show improving results in the second half of this financial year.

"Our capital expenditure and development programmes, particularly in Italy and Switzerland, are on track as we continue to invest for growth."