Carphone all out of credit

£490m write-down as shops shut

LOSSES at electrical specialist Dixons Carphone have soared to £440million in the last six months.

It was hit by a write-down of its Carphone Warehouse mobile phone business.

Earlier this year the firm revealed 92 of its 700 Carphone stores would close.

And yesterday it was forced to slash £490m off the value of that division of the business while warning over “uncertainty” in the UK market.

Chief executive Alex Baldock said: “There are headwinds and uncertainty facing any business serving the UK consumer.”

He revealed a new strategy to boost profits by flogging credit and increasing online sales, and said plans to merge IT systems and reduce supplier costs would save £200m.

He also promised there would be no job losses as a result and cheered staff with a share ownership scheme which will give 30,000 workers £1,000worth of shares each.

“The share ownership scheme will see every permanent colleague with 12 months’ service granted at least £1,000 of shares each over the next three years,” the company said. Carphone Warehouse made a £31m underlying loss in the first half year, while the electricals division saw its profits slump 40% to £42m.

The group, which also owns Currys PC World, said full-year one-off costs will increase to £100m.

They include a £17m hit from a massive cyber attack, which saw details from 5.9 million bank cards and 10 million personal data records being hacked in 2017.

“We’ve had our own challenges, and our plan will take time,” Baldock admitted.

“But with this plan, we can see the way to unleashing the true potential of this business.”

Richard Hunter, head of markets at Interactive Investor, said: “Unfortunately, this statement has laid bare the fact that Dixons Carphone has many plates to spin when the competition in the sector is intensifying.”