Dixons Carphone reports rising sales and profits as it balances stores and digital

Multichannel retailer Dixons Carphone [IRDX RDXC] today reported rising sales and profits in its latest financial year as it rationalises its store estate and invests in digital.

The retailer, whose range

includes white goods and computing, and whose brands include Currys [IRDX RCUR] and PC World [IRDX RPCW], both Leading retailers in IRUK Top500 research, and Top50 retailer Carphone Warehouse [IRDX RCAR] reported group sales of £10.5bn in the year to April 29, 9% on the previous year. Headline pre-tax profits of £571m were up from £478m a year earlier, although bottom line pre-tax profits came in at £386m, 9% up from £263m last time, after one-off charges of £115m related to factors including business exits, merger and transformation costs and value write-downs.

The retailer is currently merging its PC World, Currys and Carphone Warehouse stores into 3-in-1 digitally-enabled brand stores as it looks to reduce its store portfolio by 134. Today it said that like-for-like revenue, which reflects only income from continuing stores, had improved by about 3%, as sales transformed from stores that had closed. As it reduces store numbers, it has invested in digital, said chief executive Seb James.

“Over the last few years a great deal of work has been done to make the company stronger, lower risk and more resilient. We are seeing the upside of these efforts now as we declare record headline profits before tax of over half a billion pounds – up 10%,” said James. “More importantly, the improvement in our cost base, the strong leadership position that we have built, the investment that we have made in our digital business and, above all, the enormous shift in customer satisfaction and price competitiveness that we have driven leave us well positioned to flourish in the years ahead.”

Dixons Carphone said UK sales of £6.5bn rose by 2%, with sales of electrical goods offsetting lower margins in mobile.

Commenting on the figures, Martin Lane, managing editor of money.co.uk said: “Dixons Carphone’s strategy to focus on closing lots of stores and move to a mostly digital business has clearly paid off. These results go to show the nations love affair for electronics isn’t fading, despite economic uncertainty for the year ahead.

“Even people who are just about managing are putting electronics on the “essential” column of their budgets. Not surprising considering our high tech lifestyles these days – the brand has been savvy to move away from stores and move their business to mostly online. A trend we’re likely to see continue for the foreseeable future.”

Mentioned in this piece…

Dixons Carphone

IRDX: RDXC

Dixons Carphone was announced in May 2014 as a merger between former competitors Dixons Retail, operating the Currys and PC World fascias, and Carphone Warehouse. (more…)

Currys

IRDX: RCUR

Currys is a British electrical retailer operating in the UK and Ireland. Part of the Dixons Carphone company, it specialises in selling home electronics and household appliances. (more…)

PC World

IRDX: RPCW

PC World is one of the United Kingdom’s largest retail chains of mass-market computers superstores. (more…)

Carphone Warehouse

IRDX: RCAR

Carphone Warehouse is a multichannel retailer of mobile phones and accessories with over 1,700 stores across Europe. The brand trades as Phone House outside Ireland and the United Kingdom and is part of the Dixons Carphone Group. (more…)

Image credits:
  • Image courtesy of Dixons Carphone