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Dixons Carphone posts drop in first half profit

Dixons Carphone saw its first half pre-tax profit decline to £61 million from £154 million in the same period in the previous year after it was hit by £58 million in one-off charges and a weaker mobile phone market.

ELECTRICALS

Dixons Carphone posts drop in first half profit

Dixons Carphone saw its first half pre-tax profit decline to £61 million from £154 million in the same period in the previous year after it was hit by £58 million in one-off charges and a weaker mobile phone market.

In the six months to 28 October, group like-for-like sales were up 4% as the company experienced like-for-like growth across all of its markets.

UK and Ireland like-for-like revenue was up 2% in the period while sales in the company’s Nordic region and in Greece rose by 8% and 7% respectively.

The results were boosted by a 7% increase in group like-for-like sales in the electricals category.

Seb James, Dixons Carphone group chief executive, said: “I am encouraged by the continued achievements in our electricals businesses across the group with like-for-like sales up 7% and growth in revenues, market share, customer satisfaction and profitability in these markets thanks to our commitment to retail innovation and to serving customers well.”

However, mobile like-for-like sales were down 3% in the period. The company attributed the drop to a tougher UK postpay mobile phone market where a combination of higher handset costs and relatively incremental technology growth caused customers to hold on to their handsets for longer. In addition, the later launch of the iPhone X pushed some sales into the second half of the financial year.

Looking ahead, James said Dixons Carphone now expects to achieve a full year pre-tax profit of between £360 million and £400 million. This compares to a previous guidance in August of between £360 million to £440 million.

James added: “The start to peak trading has gone well with sales records being broken in all territories. Everywhere, we have seen material share gain and this shows that our retail businesses continue to be able to entice customers into buying the amazing new technologies that we offer. We must remember, though, that there is plenty of peak left to go.”

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