Carphone seeing fruits of link-up

Carphone Warehouse offset slower growth in its European mobile phone arm yesterday thanks to its partnership with American electronics giant Best Buy.

The UK retailer lifted its full-year earnings guidance due to expectations that a profit-sharing agreement with Best Buy's mobile phone retailing operation in the US will now generate up to 100m for the company.

It said its core European operation performed well in the Christmas quarter, although like-for-like sales growth slowed to 0.7 per cent from 2.4 per cent in November.

Carphone added connections were down 7.1 per cent due to the continued modest take-up of prepay smartphones and as tough conditions in a number of continental markets offset strong trading in the UK.

The mobile phone retail business is now part of Best Buy Europe, which is a 50-50 joint venture with Best Buy and also features the recently-launched Big Box consumer electronics stores. Carphone said the performance of its first six Big Box stores reaffirmed its belief in the "substantial opportunity" that exists within the sector.