By Maryam Cockar
Shares in Dixons Carphone PLC (DC.LN) rose Thursday after it posted adjusted pretax profit in line with the group's expectations, despite statutory profit falling 28% due to challenges in the U.K. mobile-phone business.
Having issued a profit warning in May, the company's fiscal 2018 headline pretax profit, which excludes amortization and other costs, was 382 million pounds ($502.1 million), matching its revised guidance. The electrical goods retailer also reaffirmed that headline pretax profit will fall to only GBP300 million in fiscal 2019.
New Chief Executive Alex Baldock was positive about the future and said he would provide more detail on the company's strategy in December. Mr. Baldock said he has put in place a new management team and plans to invest more in staff and its customer offering.
However, the company said it expects that the U.K. electricals market will continue to contract in fiscal 2019 and there will some cost increases, partly due to the U.K. National Living Wage.
Dixons said it is making progress in contract discussions with mobile-phone networks in order to improve its business model, but it expects a further decline in the postpaid mobile-phone market in fiscal 2019.
For the financial year ended April 28, Dixons made a statutory pretax profit of GBP289 million compared with GBP404 million the year earlier.
Revenue increased 3% to GBP10.53 billion from GBP10.23 billion. Group like-for-like revenue rose 4% and U.K. and Ireland like-for-like revenue rose 2%.
The FTSE 250-listed company maintained the final dividend at 7.75 pence a share, keeping the full-year dividend at 11.25 pence.
At 0821 GMT, Dixons shares were up 4.25 pence, or 2.2%, at 195.00 pence.