Kesa , Europe's No. 3 electricals retailer, said it was seeing no improvement in trading trends in the key Christmas period, joining the gloomy chorus from major store groups on the festive outlook.

What we've been seeing since the start of the third quarter for us (November 1) is actually the same trends that we saw at the end of the second quarter, Chief Executive Thierry Falque-Pierrotin told reporters on Wednesday.

It's a declining market but on the same negative numbers we had at the end of Q2, he said.

Second quarter group sales at stores open over a year had fallen 6.0 percent, with like-for-like sales down 3.6 percent at its market leading Darty France business and slumping 15.1 percent at its loss-making Comet business in the UK, which is being sold.

Falque-Pierrotin said consumers would continue to benefit from pre-Christmas discounts.

In all the markets where we are we see some promotion increasing, he said, adding Kesa was well prepared for the peak season despite the tough environment.

The CEO was speaking after Kesa reported a swing to a first-half loss.

Electrical specialists such as Kesa and Europe's No. 1 and 2, MediaMarkt Saturn and Currys owner Dixons Retail , are battling cut-price competition from supermarket chains and the Internet at a time when European consumers are reining in spending as they fret about rising prices, muted wage growth, job losses, government austerity measures and, more recently, the euro zone crisis.

VALUATION HALVED

Shares in Kesa, which have lost half their value over the past year, were down 6.6 percent at 76.5 pence at 0924 GMT, valuing the business at about 431 million pounds.

Kesa made a retail loss of 9.2 million euros (7.8 million pounds) in the six months to October, in line with guidance issued last month for a loss of around 11 million and compared with a profit of 32.4 million in the same period last year.

Revenue fell 7.6 percent to 2.57 billion euros, while gross margin improved 10 basis points, reflecting a strategy of driving sales of higher margin small domestic appliances and accessories.

Last month Kesa agreed to sell the 248-store Comet business to private investment firm OpCapita for a nominal 2 pounds, with OpCapita receiving a 50 million pounds dowry.

Shareholders will vote on the deal on December 15. Kesa Chairman David Newlands said OpCapita had secured the finance to complete the deal.

Kesa has guided that because of the positive impact of the soccer World Cup last year it expects the balance of revenue and profit will be significantly more weighted towards its second half than was the case in 2010/11.

But it also warned last month that unless market conditions improved, Darty France's 2011/12 retail profit would be below the prior year's 149 million euros.

Generally, we don't like companies who tell us that profits will be unusually second half weighted, mainly because it nearly always turns out not to be the case, said Panmure Gordon analyst Philip Dorgan, who cut his target price from 80 pence to 70 pence and is forecasting a full-year underlying pretax profit of 52 million pounds.

After exceptional charges of 133.6 million euros, largely in respect of impairment of assets at Comet, Kesa made a first-half pretax loss of 148 million euros versus a profit of 27.2 million euros last year.

It did, however, maintain its interim dividend at 2.25 cents.

(Reporting by James Davey; Editing by Dan Lalor and Hans-Juergen Peters)