Dixons Carphone released first-quarter results with a boost in sales across the board today – so why has its share price slumped?
For starters, the electricals giant has downgraded profit expectations to between £360m and £440m owing to a “challenging” UK phone market.
Boss Seb James flagged currency fluctuations, the lack of a must-have smartphone release and shoppers holding on to their phones for longer as factors that would hinder profits in this financial year and possibly beyond.
Today’s results, which Dixons Carphone released ahead of schedule, are in stark relief to its recent preliminary figures, which boasted record profits and an ebullient James hailed the resilience of the UK consumer environment.
It is the second time the electricals retailer’s share price has taken a hammering in as many weeks, which is at odds with what was, profit warning aside, an upbeat update from the retailer.
However, strong UK like-for-likes and a steady international performance were not enough to distract from the storm clouds on the horizon for nervy shareholders – which begs the question what a smartphone slowdown will mean for less resilient players in the electricals sector.
Also today, Sainsbury’s Argos’ Bertrand Bodson was snapped up and away from the retail sector by pharmaceutical giant Novartis and Retail Week gets the first look at Debenhams’ new store in Stevenage.
Quote of the day
“In contrast with many other retailers, we’re seeing surging sales on the high street. We’re bucking the trend and committed to sustaining this growth through further investment over the next 12 months and beyond, as we deliver our plan to become one of retail’s best growth stories.” – The Works chief executive Kevin Kearney, on its plans to open 60 new stores over the next year
Today in numbers
The number of years since House of Fraser last opened a new department store
The amount of businesses that said EU nationals were considering leaving the UK owing to uncertainty brought on by Brexit
H&M stablemate Arket will open its first store on London’s Regent Street – keep an eye out for Retail Week’s take on the high street newcomer.
Grace Bowden, reporter