Dixons to close one in three stores

Dixons is to axe almost a third of its stores in the biggest closure programme in its history.

Although Dixons is expected to meet City profits expectations of about £330 million in the financial year just ending, the City is worried about the future growth of the business.

The company also said a bigger shake-up of the Dixons brand was planned because of lacklustre sales. In a statement, Dixons said: "Tests of new format Dixons stores will continue as part of the profits improvement plan."

It has already piloted four branches of a new format called Dixons XL, which has more floor space and tends to be away from prime high street sites. Customers appear to be more reluctant to go to the high street for bulkier items such as plasma and widescreen TVs, partly because of the difficulty in getting cars close to town centre locations. The closures are expected to cost about £48 million.