Archived article
Please note that tax, investment, pension and ISA rules can change and the information and any views contained in this article may now be inaccurate.
magazineDixons Carphone’s profits are lacking spark
DIXONS CARPHONE (DC.) 192.65p
Gain to date: 1.2%
Original entry point: Buy at 190.35p, 21 December 2017
Our bullish call on retailer Dixons Carphone (DC.) remains modestly in the black despite a punishing profit warning (29 May) which called a halt to a recent rally in the name.
In his first trading update, new CEO Alex Baldock carried out a classic kitchen sinking exercise, grounding expectations as he sets about injecting fresh impetus into the business.
While headline pre-tax profit of around £382m for the year ended 28 April will meet market expectations, the result will be well down on last year’s £501m.
The Currys PC World-to-Carphone Warehouse owner also warned profits for the current financial year will fall to roughly £300m, well short of previous expectations amid cost increases, problems in the mobile phone business and ‘further contraction’ in the UK electricals market.
Fourth quarter (Q4) UK & Ireland like-for-like sales growth was negligible, softer computing market conditions a headwind, although Dixons Carphone also reported Q4 like-for-like growth of 8% and 10% for the Nordics and Greece respectively and plans to maintain the full year dividend at 11.25p.
Important information:
These articles are provided by Shares magazine which is published by AJ Bell Media, a part of AJ Bell. Shares is not written by AJ Bell.
Shares is provided for your general information and use and is not a personal recommendation to invest. It is not intended to be relied upon by you in making or not making any investment decisions. The investments referred to in these articles will not be suitable for all investors. If in doubt please seek appropriate independent financial advice.
Investors acting on the information in these articles do so at their own risk and AJ Bell Media and its staff do not accept liability for losses suffered by investors as a result of their investment decisions.
