Dixons Carphone profits rise by 30%
The newly merged Dixons Carphone increased its underlying pre-tax profit by 30% in the first half of its financial year as trade was boosted by market share gains.
In the 31 weeks to 1 November pro forma pre-tax profit was £78 million compared to £60 million in the same period a year earlier.
However, the group posted a statutory loss before tax from continuing operations of £20 million after taking into account exceptional charges of £100 million.
Dixons Carphone reported a 5% increase in group like-for like sales in the period. This included a 6% increase in like-for-like sales in the UK & Ireland and a 5% rise in Northern Europe. However, like-for-like sales in Southern Europe dropped by 11%.
The group said its UK & Ireland business had a strong first half across both electricals and mobile, particularly in the second quarter. The electricals business continued to build on a strong first quarter with white goods and TVs selling well across the half, with a particularly good performance in high-end TVs, helped by initiatives such as free warranties.
Its mobile business in the UK & Ireland also performed well with postpay volumes and market share continuing to grow year-on-year, particularly towards the end of the period when the business benefited from the closure of Phones 4U and a number product launches.
Dixons Carphone said its Nordic business had enjoyed a solid first half with good trading across all major categories. In contrast, conditions were tough in Germany and the Netherlands where the group’s businesses are going to be reviewed and restructured.
The group said the merger of Dixons Retail and Carphone Warehouse had gone well with integration a year ahead of schedule.
Sebastian James, Dixons Carphone group chief executive, said: “The integration of our business seems to be going better than I dared hope, and our integrated stores are trading very well which augurs well for the future.
“All in all, then, this has been a very good half year but there is a lot more of the year to go and a crucial Christmas to come, against a backdrop of big changes in how and when customers do their Christmas shopping. Black Friday was an extraordinary – and fun – day but we are all acutely aware that there is no room for complacency.
“Ahead of this all-important peak period we remain comfortable with market expectations for this year; at the same time we know that we will need to keep our foot on the gas if we are to achieve our ambitious longer-term goals.”
