29th May 2018 09:47
LONDON (Alliance News) - Dixons Carphone PLC said on Tuesday that it expects to record a sharp drop in profit for its recently ended financial year, as a result of declining market conditions, reduced profit margins, and expensive network contracts in the UK.
The mobile phone and consumer electronics retailer said it expects to report pretax profit for the year that ended April 28 of approximately GBP382 million, down 24% from GBP501 million the year before.
Margins have been under pressure in its UK electrical division as a result of category and channel mix, Dixons Carphone said. It said expects that the electricals market will continue its contraction throughout the year. Its UK mobile division has seen margins reduced by network contracts.
The company said it remains committed to equalling the 11.25 pence per share dividend paid in financial 2017.
Dixons Carphone expects revenue to have rise 3% from the year before. However, UK revenue is likely to rise by 2%, below the pace of the group as a whole.
The company anticipates reporting like-for-like sales growth of 4%. Strong growth is expected internationally with like-for-like-sales in Greece increasing by 11% and in the Nordics by 9%.
In the company's fourth quarter, like-for-like sales in the UK and Ireland increased by just 1%.
We're focusing early action on the UK. In electricals, we're focused on gross margin recovery. In mobile, we're stabilising our performance through improvements to our proposition and network agreements...We won't tolerate our current performance in mobile, or as a group," said Dixons Carphone Chief Executive Alex Baldock.
Shares in Dixons Carphone were down 21% at 183.99p on Tuesday morning.
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