January 22, 2018 / 8:05 AM / 2 months ago

UPDATE 2-Dixons Carphone enjoys strong Christmas before executive exodus

* CEO said on Friday he was taking job at Boots

* Group sales beat forecasts in Christmas quarter

* Full-year profit forecast range narrowed

* Shares up 2.4 pct at 0950 GMT (Adds detail, CEO, analyst comment, shares)

By James Davey

LONDON, Jan 22 (Reuters) - Britain’s Dixons Carphone, battling a fall in profit and set to lose its two top executives, beat forecasts for Christmas trading, helped by market share gains in electricals and demand for the new iPhone.

The UK’s largest electricals and mobile phone retailer reported a 6 percent rise in underlying revenue in the 10 weeks to Jan. 6, its fiscal third quarter. That was above analysts’ average forecast of growth of 3 percent.

The group said it had been helped by strong demand in the Nordics and Greece and better iPhone X availability and gave a more precise range for its full-year forecast.

It now expects 2017/18 profit before tax in the range of 365-385 million pounds ($508-534 million). 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.

Shares in Dixons Carphone, down 45 percent year-on-year after an August profit warning, were up 2.4 percent at 0950 GMT.

“Dixons Carphone has a very strong market position in both the UK and Northern Europe, and we think its business is likely to prove more resilient than the market expects,” said RBC Europe analyst Richard Chamberlain.

Dixons Carphone issued its update a day earlier than planned after CEO Seb James said on Friday he would step down in April to join retail chemist Boots. The group’s finance director Humphrey Singer is due join Marks & Spencer this year.

James will be succeeded by Alex Baldock, who has been CEO of online retailer Shop Direct since 2012. The company is also seeking a replacement for Singer who is due to leave in July.


Dixons trades as Currys, PC World and Carphone Warehouse in Britain, Elkjop and Elgiganten in Nordic countries and Kotsovolos in Greece.

Like-for-like sales in the UK & Ireland division rose 3 percent, better than expectations of a 2 percent rise. Sales in the Nordics and Greece rose 11 percent and 23 percent.

Dixons announced plans in December to reposition its mobile phone business after a 60 percent slump in first-half profit, hurt by customers keeping their handsets longer.

It said on Monday its gross margins would continue to be challenged in the mobile sector, but the phasing of the iPhone launch and other new offers helped it increase its mobile revenue by 8 percent.

“We have an early Easter, a new Samsung phone and the first week or two of our World Cup promotion to look forward to,” James said.

James said Dixons Carphone kept its “antennae twitching” for any material change in consumer behaviour but had not seen any in Britain.

“The consumer’s OK in the UK, in our European businesses the consumer is very strong,” he said. ($1 = 0.7192 pounds) (Additional reporting by Kate Holton; Editing by Louise Heavens and Keith Weir)

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