Game Digital's sales rose over Christmas and margins improved, although sales at its UK business suffered.
The company, which sells video games and consoles, posted group like-for-like sales growth of 2% for the seven weeks over the festive period.
However, like for-like retail sales for the UK business slipped 0.3% in the period as demand for physical entertainment products declined.
Zoe Mills, retail analyst at analytics company GlobalData, said much of Game's decline in the UK is due to its store optimisation plan that includes closing and relocating stores.
However, she noted that Game should have had a better performance as there was a number of popular video game releases in the run up to Christmas.
The decline in the UK was offset by a 4.8% rise in like-for-like sales from the company's Spanish retail arm.
Game said its trading margin has improved following strong sales of higher margin products.
Chief Executive Martyn Gibbs was bullish on Games's sales results.
"Despite a challenging retail climate, the group traded solidly over the Christmas period, with encouraging like for like sales in both territories.
"The group successfully delivered growth from exclusives, higher margin categories and our specialist customer offer over the Black Friday event, which all contributed to a pleasing margin outcome and helped to offset the continued, managed decline of pre-owned".
Mr Gibbs said the company's transformation programme launched two years ago has gathered pace and the group is working with landlords to bring down the fixed costs for its store portfolio and produce ongoing efficiencies.
Meanwhile, Game said it will not apply to move the company's listing from the Main Market of the London Stock Exchange to the Alternative Investment Market as it does not expect to get shareholder approval at the annual general meeting on Thursday.
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