Black Friday is here to stay, says Dixons Carphone as sales soar

Dixons Carphone deputy chief executive Andrew Harrison, left, with Sebastian James.
Dixons Carphone deputy chief executive Andrew Harrison, left, with Sebastian James.
0
Have your say

​STRONG sales of ​​​large-screen TVs and coffee machines have boosted sales at ​Dixons Carphone, the newly created company behind retail brands Carphone Warehouse, Currys and PC World.

The group, which is worth £5bn following its merger in the summer, said like-for-like sales rose five per cent in the half year to November 1 and group profits rose 30 per cent to £78m.

It said white goods and televisions sold well in Currys and PC World stores, driven by demand for high-end TVs which came with free warranties.

The group said ‘Black Friday’, the day after American Thanksgiving when prices are slashed, is now a welcome fixture in the British retail calendar and was one of its busiest days.

Dixons Carphone said it was able to protect margins by placing very large orders with suppliers.

Finance director Humphrey Singer said: “We end up making incredibly large promotional offerings for customers in combination with suppliers and that ensures that we can get the right margin.”

He added that the November 28 event was “huge”, exceeding company expectations, as shoppers snapped up Samsung TVs, De Longhi coffee machines and Bose speakers. He said Black Friday is now rivalling Boxing Day as its biggest day of the year.

“This is the new pattern of Christmas trading and we’re all going to have to get used to it.”

The Black Friday shopping spree pushed British retail sales growth to a three-month high in November.

The group said its Carphone Warehouse mobile business sold more contracts as it benefited from the collapse of Phones 4U and recent product launches.

​Chief executive Sebastian James said: ​​“The integration of our business seems to be going better than I dared hope, and our integrated stores are trading very well which augurs well for the future.

“There is still much, much more to do, but I have been struck by the willingness of people at all levels and from all parts of the business to roll up their sleeves and get on with it.”

​In August Dixons Retail, Europe’s second largest consumer electronics retailer, and Carphone Warehouse, Europe’s largest independent mobile phone firm, merged to create Dixons Carphone, which jumped straight into Britain’s blue chip FTSE 100 index.

The merged firm made a pro forma pre-tax profit of £78m in the 31 weeks to November 1. Revenues rose one per cent to £5.02bn.

The company said it is comfortable with market expectations for the 2014-15 year.

Market share was won in the UK and Ireland, Nordics and Greece.

However, the Netherlands and Germany remained “challenging”.

The firm’s businesses there are being reviewed, with some stores already closed and head office costs reduced.

The company booked exceptional charges of £100m, partly relating to the restructuring in Germany and the Netherlands.

The group said the integration of Carphone and the business of PC World and Currys continues to progress well​ and​ its target for a minimum £80​m of cost savings ​has ​been brought forward by a year to 2016-17.

Analysts at Killik & Co said: “The performance was driven by a particularly strong second quarter with like-for-like sales growing 11 per cent in the UK & Ireland as the group was able to gain market share across all its brands with strong sales driving increased profits.”