Currys PLC (LSE:CURY) shares jumped over 9% to 140p after reporting a sharp rise in profit and cash flow for the first half of its financial year, setting up for the much more important festive period.
The electrical products retailer maintained its guidance for the full year, expecting continued growth in profits and free cash flow. It noted that trading during the first six weeks of the second half has been in line with board expectations
For the six months to 1 November, underlying earnings (EBITDA) grew 32% to £54 million, with adjusted profit before tax jumping 144% year-on-year to £22 million, as revenue increased 8% to £4.2 billion, with like-for-like revenue up 4%. Free cash flow grew 68% to £84 million.
UK & Ireland revenue climbed 6%, supported by growth in recurring service revenue, increased adoption of credit, B2B sales and performance in new product categories. However, adjusted EBIT in the region declined by £4 million to £19 million due to higher government-driven colleague costs.
The Nordics division delivered 7% revenue growth on a currency-neutral basis, with adjusted EBIT rising 94% to £35 million, driven by higher sales and controlled costs.
"We're pleased with the momentum we've built, with healthy growth in sales, profits and cash flow," said group chief executive Alex Baldock.
"In the Nordics, being the clear leader in an improving market, combined with strong execution, has driven another notable step forward in profits."
He said growth initiatives were paying off in all markets, and the group had entered the peak period "well prepared, with strong stock availability and market-leading deals that reflect our unmatched importance to our partners".
So far, £30 million of a planned £50 million share buyback has been completed, with an interim dividend of 0.75p per share declared.
Analysts at Peel Hunt said the results were ahead of forecasts, although the first half of the year only represents 10% of expected full-year performance.
They noted that LFL sales of over 4% compares to a wider UK market down 1.2%.
** UPDATE: Adds share price, broker comment **