Dixons Carphone profits up 30% as merger integration exceeds expectations

Underlying profit before tax increased to £78m for the 31 weeks ending November 1, while group like-for-like revenue increased by 5% during the period.

Profits are compared with Carphone Warehouse’s 26 week period ending September 28 2013 and Dixons Retail’s six month period ending October 31 2013.

Dixons Carphone group chief executive Sebastian James said: “We have seen a barnstorming performance from our UK & Ireland division with like-for-like sales growth of 6% in the first half and 11% in Q2.

“The integration of our business seems to be going better than I dared hope, and our integrated stores are trading very well, which augurs well for the future. There is still much, much more to do, but I have been struck by the willingness of people at all levels and from all parts of the business to roll up their sleeves and get on with it.”

Dixons Carphone claims it will deliver a minimum of £80m of synergies by 2016-2017, one year ahead of plan, following the completion of the merger of the Dixons Retail and Carphone Warehouse businesses on August 7.

Televisions and mobiles sold well during the half, while in computing the laptop market appears to be stabilising and tablets were down year-on-year due to “limited product innovation”.

Dixons Carphone recorded market share gains across its electrical and mobile businesses in the UK & Ireland, Nordics and Greece during the half.

However, Dixons Carphone said its Netherlands and Germany operations “remain challenging” and is in the midst of reviewing a restructure of the businesses.

James points out the retailer has “a crucial Christmas to come” against a backdrop of changes in how customers carry out their Christmas shopping.

He added: “Black Friday was an extraordinary - and fun - day but we are all acutely aware that there is no room for complacency.

“Ahead of this all-important peak period we remain comfortable with market expectations for this year; at the same time we know that we will need to keep our foot on the gas if we are to achieve our ambitious longer-term goals.”