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Carphone puts Best Buy store venture behind it

Alex Scroxton

smartphones.jpgCarphone Warehouse has taken a positive outlook for the final three months of its fiscal 2012 after posting 15% growth in sales in Q3 and closing the book on its doomed big box store venture with Best Buy.

In an interim management statement, Carphone revealed that all 11 of the UK stores and the online presence had now been closed, with all inventory now cleared and the majority of staff successfuly redeployed.

The financial impact of the closure remains in line with the figure of about £100m set out in November.

Looking back on the Christmas perod, CEO Roger Taylor said that the Carphone Warehouse Europe business had performed strongly on postpay (contract) mobile sales and was benefiting from improved profitability of its new postpay commercial terms.

As expected, prepay mobiles proved very weak, down nearly 40% in the UK alone, driven by a reduction in network subsidies, a lack of smartphone offerings, and a weak consumer environment.

Non-cellular revenues, meanwhile, grew 15% as sales of tablets accelerated. Added Taylor: "We remain well-placed to benefit from continued consumer enthusiasm for connected technology, and as such we are accelerating the roll-out of our Wireless World srotes to meet this demand."

"As with all retailers, we face a touch consumer backdrop," Taylor conceded," but  we are capitalising on the strong product cycle in smartphones and non-cellular categories. With confidence in our future, we are reiterating our guidance for this year's headline earnings."


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