Carphone Warehouse like-for-likes edge up 2.3% in fourth quarter

Carphone Warehouse narrowed its EBIT range for the year to £145m to £155m, from £140m to £160m.

The mobile phones retailer made no mention of its £4bn merger talks with Dixons in its trading update this morning. The Takeover Panel has imposed a May 19 deadline for the two retailers to confirm whether they intend to press ahead with a deal.

Carphone Warehouse said overall connections dropped 10.1%, which reflected continued weakness in the prepay market. However, its focus on higher value postpay connections led to market share gains. The retailer said it was gaining momentum in driving 4G services, which leads to significantly higher data take-up.

In Europe, Carphone Warehouse plans to increase its relevance and scale through partnerships.

The retailer said it was “making good progress” in the Netherlands with the roll-out of stores within stores in partnership with Media Markt Saturn. It said it was in talks with Metro Group in Germany where it plans to open stores over the coming months. It is plotting stores with other partners in further territories.

Carphone Warehouse chief executive Andrew Harrison said: “We continued to show good momentum, with further growth in like-for-like revenues, against strong comparatives.

“The mobile market continues to see a fall in prepay connections; but this has been compensated by an increase in 4G penetration, with higher levels of data take-up at a pricing premium, and consequential growth in customer ARPU [average revenue per user]. Our executional focus remains strong, with our tablet-based sales tool, ‘Pin Point’, continuing to drive customer satisfaction and conversion, to the benefit of customers, network operators and ourselves.

“We are also making good progress in our partnership and Connected World Services strategy and have now opened 31 Samsung stores in seven countries, with approximately 30 more stores to be opened in the first phase.”

Carphone Warehouse said it has been building a pipeline of potential partners during the quarter for further tie-ups. 

Its Virgin Mobile France joint venture, of which it holds a 46% stake, resulted in a 8.6% sales drop during the period.