Dixons Carphone has recorded a slump in pre-tax profit exacerbated by sliding mobile sales, but boss Alex Baldock says the retailer’s transformation plan is “on track.”
The electricals retailer posted a 60% drop in adjusted pre-tax profit to £24m in the half-year to October 26 as group sales fell 4% to £4.7bn.
On a statutory level, the retailer narrowed pre-tax losses to £86m from £440m during the same period the previous year.
UK and Ireland electricals revenue dipped 1% during the period to £2bn with flat like-for-like sales. The retailer’s electricals performance was aided by online growth of 11% in the category.
In contrast, mobile sales slumped 18% to £830m, down 10% in like-for-like terms.
Dixons Carphone chief executive Alex Baldock said: “Mobile is challenging as expected. As promised, this will be the trough year for mobile losses, and it will be break-even by 2022.”
The electricals retailer remodelled 81 stores during the period as well as kicking off a £4m training initiative to improve service levels in its stores. The retailer said it is making “good progress” on its technology infrastructure investments but is “rephrasing spend on larger projects.”
Dixons Carphone operated 1,500 stores across eight countries during this financial period. Its international revenue rose 1% and 3% in overall and like-for-like terms respectively to £1.9bn.
“We’re on track to deliver what we promised this year, and with our longer-term transformation,” said Baldock.
“In a tough UK Electricals market, we’ve gained significant share and strengthened our market leadership. Our planned investments in the colleague and customer experience have played a big part in this resilient performance, demonstrated by sharply increased customer satisfaction scores. Our big international business also registered market share gains in every territory, with solid sales and margin improvements.
“And we’ve taken important strides in our transformation. It’s easier for customers to shop how they want: we’re now gaining share Online as well as in stores, where we are investing to create exciting, enticing stores.
“Good progress, yes, but all of us at Dixons Carphone are shareholders, and conscious that our business is still nowhere near its full potential. We’re determined to realise that potential and confident we’re on the right path to do so.”
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