 has announced plans to close 92 stores as the retailer issued a profit warning. Shares tumbled 20 percent as the group expects){kind=link}
Dixons Carphone (LON: DC) has announced plans to close 92 stores as the retailer issued a profit warning.
Shares tumbled 20 percent as the group expects 2017/18 pre-tax profits to be £87 million lower than analyst expectations, who predicted profits of £387 million.
“Right now, with our international business in good shape, we’re focusing early action on the UK,” said the group’s chief executive, Alex Baldock, who replaced Seb James earlier this year.
“In electricals, we’re focused on gross margin recovery. In mobile, we’re stabilising our performance through improvements to our proposition and network agreements.”
“In both, we’ll work hard to improve our cost efficiency. We won’t tolerate our current performance in mobile, or as a group. We know we can do a lot better.”
Dixons Carphone blamed “challenges” in the market for their poor performance, including consumers not replacing mobile handsets as frequently.
Baldock said that international business was in “good shape”, with like-for-like sales in Greece up 11 percent. He continued to say the group’s plan is to focus “early action on the UK”.
“Eight weeks in the business have cemented my optimism about Dixons Carphone’s long-term prospects. I’ve found exceptional strengths, and though there’s plenty to fix, it’s all fixable.”
Dixons Carphone joins the string of high street retailers who have announced closures in recent months including Carpetright (LON: CPR), Mothercare and Byron.
5,855 stores have closed on the UK high street in 2017 – more than in any year since 2010.
Lisa Hooker, consumer markets leader at PwC, said: “2017 was tough for the British retail industry, particularly the second half of the year. We saw volatility from month to month and across different sectors as wage growth failed to keep up with inflation, forcing many shoppers to think more carefully about their spending habits.”
Neil Wilson, the chief market analyst for Markets.com, said that despite the poor results for Dixons Carphone, the problems were entirely “fixable”.
The group have said that no jobs will be lost with the 92 store closures.