March 26, 2020 / 7:50 AM / 10 days ago

Britain's Dixons Carphone warns on profit due to coronavirus pandemic

LONDON (Reuters) - British electricals retailer Dixons Carphone warned on Thursday it would not meet its previous guidance for 2019-20 profit and debt due to the coronavirus emergency which has forced the closure of its stores in the UK, Ireland and Greece.

A sign displays the logo of Dixons Carphone at the company headquarters in London, Britain August 1, 2017. REUTERS/Neil Hall

The group’s previous guidance was for adjusted pretax profit of 210 million pounds ($249 million) and lower net debt year-on-year. It said it will not update current year or medium-term guidance until the impact of COVID-19 becomes clearer.

Dixons Carphone said almost all its stores in the Nordics continue to trade and its online operations remain open.

It said online trading has been very strong in all countries over the last two weeks as people have been buying technology to work from home during the crisis.

“Early signs are that this strong trading has continued since stores closed and will help to compensate for lost store sales,” it said.

The group said that in the eleven weeks to March 21 electricals like-for-like sales rose 8%, reflecting a strong recent uplift - up 23% in the last three weeks.

“We have seen very good sales of equipment for home working (laptops, printers), for home entertainment (TVs, gaming) and for home living (fridges, freezers, kitchen appliances),” it said.

Overall group like-for-like sales were up 4% over the eleven weeks, held back by a 15% fall in mobile phone sales.

Dixons Carphone said it is taking measures to preserve cash during the crisis by taking advantage of government support, controlling discretionary spending, lowering capital expenditure, reducing stock ordering and deferring tax payments.

It will decide whether to pay a final dividend in June.

($1 = 0.8433 pounds)

Reporting by James Davey; editing by Sarah Young

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