The Group bought Vision Technology Group Ltd (VTA), which operated four PC World Superstores and a group of companies selling mail order PCs, peripherals, software and accessories to companies, educational institutions and private individuals.
VTG's PC World Superstores were based in Croydon, Lakeside Retail Park at West Thurrock, Brentford and Staples Corner, north London.
The Group sold VTG's mail order division and focused on the retail side of the business.
The Group also sold Dixons US Holdings Inc, Silo's parent company, to Fretter Inc in which it retained a 30 per cent stake. Supasnaps was sold to Sketchley plc.
In January John Clare was appointed Group Chief Executive.
The Group announced the pilot of a new shopping format called The Link, which would sell the latest generation of communication services and products.
The first Dixons tax-free store opened at Heathrow Terminal 3 in July.
In December, the Group moved its head office from Ealing to new premises in Hemel Hempstead, Hertfordshire.
The Group opened the largest electrical superstore in Europe - the 32,000 sq ft Currys Superstore at Junction 9 off the M6 in Birmingham.
It also opened the fourth Dixons tax-free shop at Terminal 4, Heathrow, following the success of its other tax-free shops at Heathrow Terminals 1 and 2 and Gatwick South.
PC World's portfolio expanded with further openings in a number of principal towns and cities in the UK.
Group Chairman Stanley Kalms was awarded a knighthood in the New Year's Honours List in recognition of his services to electrical retailing.
In April, Dixons became the first to sell the new Advanced Photographic System cameras.
The Group acquired DN Computer Services plc (DNCS), the computer reseller business, which became part of the PC World division. DNCS enabled PC World to establish an even stronger position in the £3 billion business-to-business market.
A £20 million expansion plan for the Stevenage Distribution Centre was announced which, when completed in August 1997, doubled its capacity.
The Group opened the first out of town Dixons store at Fosse Park retail centre, Leicester and its first store in the Republic of Ireland.
The Group acquired the retail assets of Harry Moore Ltd, the Ireland-based electrical retailer. The Group strengthened its presence in Ireland, opening a third Dixons store in Dublin and the first PC World store (and the largest computer superstore) in the Republic.
Telecom Securicor Cellular Radio Limited (Cellnet) bought a 40 per cent stake in The Link, Dixons' specialist mobile phone and communications retailer.
The Group announced record profits of £190.2 million and launched PC World Business Direct, a new IT mail order service incorporating the brand strength of PC World and the sector expertise of DNCS.
The nation's £8 billion a year obsession with electronic gadgetry was marked in October by the launch of 'Dixons Online' - the first electrical goods internet home-shopping service. Customers were offered guaranteed next-day delivery on mainland UK of over 2,000 products.
Dixons Online was given a facelift, taking web customers further into the future of customer technology. New e-commerce sites were launched including PC World Business Direct and PC World Software.
The Group acquired Byte Computer Superstores Ltd with 16 retail outlets.
The Group also continued its commitment to New Deal, announcing plans to take on a further 100 employees from the scheme. In July, the Group took on its first New Deal trainee in Scotland.
At the year end, the Group announced full year pre-tax profits of £217.6 million and plans to open more than 100 new stores in 1998/99 creating around 2,000 additional jobs.
Currys became the first electrical retailer to stock Plasma Flat TVs in widescreen format. Later in the year, Currys and Dixons were among the first retailers to sell Integrated Digital TVs.
In September, the Group launched Freeserve, the UK's first fully-featured internet service available free with no registration or subscription fees.
In January, Dixons Group Retail Properties Limited was established to manage and develop the Group's retail portfolio.
The Link sold its millionth mobile phone after just four years of trading. Freeserve also announced a milestone - its millionth subscriber.
The lowest-priced PC ever offered by a UK retailer - at just £399 - went on sale at PC World, Dixons and Currys.
Year end pre-tax profits of £237.1 million were announced alongside plans to create more jobs in the coming year. The Group also announced its intention to float 20% of Freeserve, and did so successfully two months later.
Dixons Select was launched in October. This shopping channel was launched on Open, the first integrated digital television shopping service.
In December the Group made an offer for leading Nordic electrical retailer, Elkjøp ASA. Within six weeks the deal was complete.
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