Families facing escalating household bills are turning to video games on the Nintendo Wii and PlayStation 3 for affordable fun.

Game Group, the video games specialist, defied the downturn sweeping the retail sector and said yesterday that business was booming as a new generation of consoles and titles, such as SingStar, a karaoke game, attracted a new type of customer.

Lisa Morgan, the chief executive, said: “Video gaming has become a great form of entertainment for all the family. It's affordable fun and an alternative to a night at the cinema or an expensive meal.” She added: “In Christmas 2000, 75percent of our customers were men. Last December 37 per cent were women and this year the number of women coming into our stores is up 10 per cent. We also get grandparents coming in.”

Game Group said in a trading statement that total sales across its UK and international stores were up by 54 per cent in the 22 weeks to June 28. Like-for-like sales - sales at stores open more than a year - were up by 28.1percent in the UK.

Ms Morgan said that pre-tax profits for the first half to July 31 would be at least £33 million - 32percent ahead of the City's most-optimistic forecasts. Game's success puts the chain among a select number of retailers bucking the gloom on the high street. Some analysts have suggested that the success stories, such as Domino's Pizza, Majestic Wine, HMV or pure internet-based operators such as Asos, indicate that the credit crunch has turned consumers into couch potatoes.

Ms Morgan rejected that notion: “Have you tried Wii Fit?” She said that Game was benefiting from an unprecedented choice of leading-edge games consoles and new releases, from Grand Theft Auto IV to Lego Indiana Jones. Retailers sold 926,000 copies of Grand Theft Auto IV in the first five days after its UK launch late in April. Mario Kart Wii, Wii Fit and Metal Gear Solid 4, the PlayStation3 title, were among the other bestsellers in the first six months of the year.

Ms Morgan said: “In previous cycles it's been about a single platform, such as the PlayStation 2. This time around we have PlayStation 3 and the Xbox 360, which are still doing incredibly well, the Wii, the Nintendo DS and PSP - there's a whole range of products that have brought new customers through the door.”

Game, formerly Electronics Boutique, conceded that the wider economic environment had become more challenging. Shares in the group dipped 12p to 250p in another tough day for retailers on the stock market as analysts raised fears that the boom in video gaming could peak this year.

John Stevenson, a Shore Capital retail analyst, said: “This is a stunning trading update. However, we believe future profitability will fall and, consequently, we believe investors should take profits ahead of 2009.”

Ms Morgan said: “We are very comfortable with where the market stands. Like-for-like sales exceeded our expectations, we have had a stunning, triple-A list of releases and we expect growth to back off a little bit.

“But there's a great line-up of software that is due to launch in the second half - much-anticipated sequels. The industry is a very interesting place to be.”

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