Dixons Carphone shares gain on new CEO and strong Christmas trading

Challenges Alex Baldock

Challenges Alex BaldockJOHN HOULIHAN

Dixons Carphone has slashed full-year profit estimates amid continued downward pressure on mobile phone margins over the Christmas quarter and "more cautious consumer" spending in the UK.

Along with greater market share growth in SIM-free handsets and SIM-only offerings, its United Kingdom and Ireland mobile sales grew around 8% over the Christmas trading period.

Reading between the lines, investors seem pleasantly surprised that trading was not far worse for Dixons Carphone.

The electricals and technology retailer said like-for-like revenue across the company went up six per cent in the 10 weeks to January 6, while year-on-year revenue was up four per cent. That compares with a previous forecast of 360-400 million pounds given in December and is a big decline from the 501 million pounds in 2016-17. Furthermore, the announcement replacement CEO Alex Baldock - current CEO of Very.co.uk and Littlewoods.com parent Shop Direct - just days after James' resignation will also be seen as a positive by shareholders (was the incumbent nudged towards the door?), confident that he can deliver a similar turnaround for Dixons to steady the ship during an overhaul in consumer spending patterns away from shops and towards online.

Over the past year, the company has been...

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Sky News can reveal that Sebastian James, who has run Dixons Carphone since the company was created in 2014, is to leave to run Boots, the high street chemist. Sales in the Nordics and Greece rose 11 percent and 23 percent.

His departure follows a profit warning in August when the firm said sales have been hit by the number of customers holding onto their handsets for longer as rising inflation and stagnant wage growth weighs on disposable incomes.

Outgoing CEO James said: "I am pleased to announce 6.0% growth in group like-for-like revenue over Christmas this year against strong comparables last year".

He said that an early Easter, the launch of a new Samsung phone and a promotion around the World Cup all have the potential to boost performance over the coming months.

"The consumer's OK in the United Kingdom, in our European businesses the consumer is very strong", he said.

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