Mobile phone malaise to drag on Dixons carphone festive sales
- Credit: Archant
Festive trading figures from Dixons Carphone on Tuesday are set to show ongoing woes in its mobile phone arm as the retailer battles to halt sliding sales in the division.
The group warned last month that it may look to shut stores after being hit by a 3% fall in half-year sales at the troubled mobile division, which contributed to a 60% plunge in half-year profits.
It parachuted deputy chief executive - and former Carphone Warehouse boss - Andrew Harrison into the unit as chairman just before Christmas as part of efforts to arrest falling sales.
Analysts are expecting solid electricals sales to help offset the mobile phone difficulties over the festive season, with the group already confirming record trading on Black Friday.
It is thought the delayed launch of the iPhone X may have helped provide a much-needed fillip to the group, although reports have suggested mixed demand for the new model.
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Analysts are forecasting a 2% rise in overall UK like-for-like sales over the 10 weeks to January 6, which would mark a slowdown on the 3% growth in the second quarter.
It is also sharply lower than the 6% sales growth over the previous festive season.
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The high street chain saw interim profits tumble to £61 million, while trading was dragged down by a 3% fall in comparable sales at its mobile phone division.
UK profit fell from £130 million to £34 million in the period and the results came after Dixons Carphone warned in August over a Brexit profit hit as the soaring cost of new mobile phones means people are holding on to older models for longer.
Mr Harrison - who led Carphone Warehouse until its £3.8 billion merger with Dixons in 2014 - has been tasked with helping the group out of its mobile malaise.
It has been a tough past few months for Dixons, which also saw Carphone Warehouse hit with a £400,000 fine in early January after a security failure allowed unauthorised access to the personal data of millions of customers.
One of the retail giant’s computer systems was affected in the 2015 cyber attack when intruders gained access through out-of-date WordPress software using valid login credentials.