Britain's largest electricals and mobile phone retailer Dixons Carphone Group PLC (LON:DC.) saw its trading over Christmas beat forecasts as it reported its fifth consecutive year of growth over the festive period and confirmed its full-year profit outlook.
The FTSE 100-listed group - which owns Currys, PC World and Carphone Warehouse stores in Britain - said overall like-for-like sales rose by 4% in the 10 weeks to January 7, in-line with its first half growth, and beating estimates for a 2.5% increase.
Trading in the UK and Ireland was strong, with like-for-like sales up 6%, against forecasts of 3.5%, and underlying sales in southern Europe – where it owns Kotsovolos in Greece – rose by 5%.
But in the Nordic region – were the firm trades as Elkjop and Elgiganten – like-for-like sales fell 1% , reflecting a focus on optimising profit margins.
Seb James, Dixons Carphone’s group chief executive, said sales of large screen TV – the firm’s view a bellwether for consumer sentiment - showed a solid performance in all its markets.
However, patchy availability of the larger, higher margin phones and tablets made those categories tougher this year, he added.
James said: “This year, as a result of our scale in all of our markets, we were able to offer prices that were truly ground-breaking during both our Black Friday week and our annual Boxing Day week sales - while maintaining margins - and we believe that we have outperformed the market during the period.
“As a result, and despite the fact that there is quite a bit of the year to go, we anticipate a meaningful uplift in year-on-year profitability this year over last and confirm our outlook in line with market consensus at £475m-£495m of headline profit before tax for the year ending 29 April 2017.”
Last month, Dixons Carphone reported a 19% increase in first-half profits, but said it was planning for the possibility of more uncertain times ahead.
Broker upbeat ...
Analysts at Liberum pointed out that Dixons Carphone’s Christmas trading “has come in at nearly double our expectations reflecting the continued momentum within the business and further market share gains.”
In a note to clients, they added: “Management has confirmed guidance in line with market expectations, although given the current LFL growth run-rate we see strong upside risk.
“The shares have been down into the results and we expect them to perform well on today's update, which reafffirms our confidence around Dixon's Carphone long-term growth prospects.”
In early trading, Dixons Carphone shares were up 0.5%, or 1.7p at 337.8p.
-- Adds broker comment, share price --