DIXONS Carphone, the retail electronics giant forged last summer from the merger of Carphone Warehouse and Currys PC World, romped ahead of all City expectations yesterday with bumper sales.
The group, valued at £5 billion after a near-40 per cent jump in the shares since the tie-up, revealed that UK and Ireland same-store sales jumped 13 per cent in the 17 weeks to 2 May.
RICHARD HUNTERA profit upgrade on a profit upgrade is testament to benefits
The figure consolidated robust momentum seen in the retailer’s Christmas trading, and was more than twice City forecasts.
Dixons Carphone enjoyed a particularly strong final quarter with same-floorspace revenues up 9 per cent, again more than double City expectations.
The group said that it now expected annual profits to be slightly above the top end of the previously guided range of £355 million to £375m.
Sebastian James, group chief executive, said: “Nearly a year into our merger, I am very pleased to be posting such a strong first full year trading statement for our combined Dixons Carphone Group.
“Good trading, driven by market share gain and by strong promotional periods – including Easter – coupled with successfully streamlining the group’s international assets, means that we are now guiding PBT (profit before tax) to be slightly above the top end of our previously disclosed range for the full year.
“On the integration, our teams should be very proud of the progress that we have made.” James added that the company would “fix the roof while the sun was shining” and would continue to invest in its IT infrastructure, extend its free warranty programme and enhance staff training.
The group said it had rolled out 233 Carphone Warehouse concessions in Currys and PCWorld stores, at a rate of about four a week.
For the full year, like-for-like sales across the company lifted 6 per cent, with an annual rise of 8 per cent in the UK and Ireland. Annual results are due to be published on 16 July.
“A profit upgrade on a profit upgrade is testament to the early benefits of the Dixons Carphone merger,” Richard Hunter, head of equities at broker Hargreaves Lansdown, said.
“The increasingly pervasive ‘internet of things’ will provide a threat for some, but an opportunity for others and the current signs are that Dixons Carphone will fall into the latter category.”
The internet of things is the expectation that technology will transform households through domestic appliances, heating and lighting being able to be controlled by the touch of a mobile device.
Will Hedden, a dealer at London Capital, said that Dixons Carphone had enjoyed “a fabulous fiscal fourth quarter”.
He added: “So far so good for the merger, and certainly encouraging for shareholders as the stock pushes through long-term highs over the last few days towards £5.”