Catalogue chain Argos has returned to profit growth after an "encouraging" year in which more than half its sales were generated online.

A digital push at the high street business helped Argos deliver a 6% increase in underlying operating profits to £100.3 million, in sharp contrast to the near 60% plunge the previous year, after its first rise in like-for-like sales for five years.

Online and mobile sales accounted for more than half of all revenues at the 737-strong chain during the year to March 2, helped by its click and collect service, while the group said it was on track to launch the first full digital catalogue before Christmas.

Parent firm Home Retail Group, which also owns Homebase, saw overall underlying pre-tax profits drop 10% to £91 million after a tougher year at the DIY chain, which was left nursing a 52% tumble in earnings to £11 million.

The group pledged to continue investing in its transformation plan at Argos and Homebase recovery efforts despite expectations for another challenging year for retailers.

Home Retail chief executive Terry Duddy said the year ahead will remain similar with consumer spending continuing to be "impacted by ongoing inflationary pressures and low levels of consumer confidence".