Electronics store Carphone Warehouse has reported a strong third quarter, with gains in smartphone sales during the Christmas sales season. UK sales are up 2pc and the company has gotten a greater than expected profit share from Best Buy Mobile US.
“We’ve delivered another good quarter, we’re again raising our guidance for our profit share from Best Buy Mobile US and we now expect full-year earnings per share to be at the top end of the range we gave in November,” said CEO Roger Taylor.
The company said third-quarter revenues were up 0.7pc while in the UK they were up 2.3pc.
Best Buy Mobile has more than 2m customers in the US and Carphone Warehouse has embarked on a 50:50 joint venture called Best Buy Europe with six shops up and running so far.
Guidance for Best Buy Europe’s full-year profit share from Best Buy Mobile US has been raised to stg£90m-£100m from stg£85m-£90m.
Surprise boost for smartphones
“CPW Europe has continued to perform well in a Christmas quarter where sales are traditionally much more weighted towards prepay handsets, the segment where smartphone penetration is still low, and where there have been high levels of price deflation in basic handsets," Taylor continued.
“Best Buy Mobile US continues its strong momentum, demonstrating its winning formula. The online launch at Best Buy UK has gone well, adding to the strong customer satisfaction with our ‘Big Box’ stores, where our planned rollout continues. Our other joint venture, Virgin Mobile France, is well on track to deliver growth and results in line with guidance,” Taylor said.
Carphone Warehouse’s latest venture, Wireless World, is now active across 73 stores and will reach 100 by March as the company endeavours to deliver devices for what it terms the "connected world".
“While we remain cautious on the economic environment across Europe, we are well positioned to take advantage of the strong product cycle in mobile phones and the ‘connected world’. We remain confident in achieving the full-year guidance that we set out with our interim results in November and now expect earnings per share to be at the top end of the existing 13.5p-14.0p range,” the company said.