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Dixons Carphone 1H profit plunges, maintains forecast as mobile turnaround on…

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Dixons Carphone 1H profit plunges, maintains forecast as mobile turnaround on...

LONDON (Reuters) – British electricity retailer Dixons Carphone (DC.L) maintained its annual profit forecast and said a plan to deal with the challenging mobile phone market was working but had no post-election boost.

FILE PHOTO: A sign displays the Dixons Carphone logo at the company's headquarters in London, Great Britain, August 1, 2017. REUTERS / Neil Hall

He reported a first-half profit drop of 60%, although he maintained his 2019-20 full-year financial guidelines.

UK voters went to the polls on Thursday in an election that could break the deadlock over Britain's exit from the European Union, but Dixons Carphone CEO Alex Baldock said political clarity would not help. necessarily consumer confidence.

"Current uncertainty is certainly affecting consumer confidence," he told reporters. He said any prospect of a post-election increase would be "an outcome I'd like to receive, but we're not counting on."

Baldock, who has been CEO since April 2018, is leading a Dixons Carphone recovery plan that has been hampered by a shift in the mobile phone market as customers keep their phones longer, choosing cheaper SIM-only deals. and become more flexible. credit based offers.

The company, which operates as Currys, PC World and Carphone Warehouse in the UK and Ireland, maintained a pre-tax adjusted profit forecast of around £ 210m ($ 269.43m) for the 2019 financial year. -2020, 30% lower than in 2018 -19.

In the first half, in the 26 weeks to 26 October, it had a pre-tax profit of £ 24 million, compared with £ 60 million a year earlier, in UK and Ireland mobile revenue, which fell by 18%. .

Shares rose 6 percent to 139 pence at 1017 GMT, which analysts said reflected the company's assurance that it would meet annual forecasts.

"An 18% decline in first-half mobile revenue is not what you might call robust, but expectations were low on results," said Russ Mold, AJ Bell's chief investment officer.

Baldock said the company is experiencing a year of losses from its mobile unit, adding that it is expected to peak in 2022.

"We are on track to deliver on what we promised this year and our long-term transformation," he said.

The improvement of the mobile business will come from the renegotiation of all legacy group contracts with Vodafone network providers (VOD.L), AND IS (BT.L) and O2 (TEF.MC)

A redesign of the group's mobile product line, including enhanced SIM-only business options and flexible credit packages, will also increase performance and fully combine the two separate business cost bases Dixons and Carphone Warehouse that came with together in a 2014 merger.

Sarah Young's report; editing by James Davey and Mike Harrison

Our standards:The Thomson Reuters Trust Principles. . (tagsToTranslate) USA (t) DIXONS (t) CARD (t) RESULTS (t) Forecast / Result Announcements (t) Performance / Results / Earnings (t) Computer and Electronic Resellers (TRBC) (t) Elections / Polls ( t)) Company news (t) Europe (t) United Kingdom

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