Product sales growth of 10.2% clearly highlights the strategic transformation is gaining momentum, and marks the 5th consecutive quarterly improvement in performance, comfortably beating market expectations. Whilst Financial Services income is down 5%, we continue to expect the trend within FS on both interest and non-interest lines to shift to growth from H2, with important implications for profitability from the improved quality of the file and arrears rates. There is no change to core guidance today although we expect small (1-2%) EPS upgrades and a c£10m downgrade to ND in response to the news 5 loss-making stores will be closed, having completed the review of that business. Given the online transformation, anticipated F4F benefits, and as we near an inflection point for international growth (in Q2), we have raised our 12-month target by 16% to 350p and continue to point investors to the re-rating potential. Buy.