Dixons’ ELECTRIC lockdown

Sales soar as families kit out home offices and buy consoles for kids

SHARES in Britain’s biggest electricals chain Dixons Carphone rocketed 12pc after a boom in demand for computers and white goods in lockdown.

It cashed in as families stuck at home rushed online to snap up kit f or makeshift offices and games consoles to entertain the kids, as well as f ridge- f reezers and coffee machines.

That offset what one analyst branded a ‘horrific’ performance at its mobile phone division as consumers hold on to handsets for longer. Overall, Dixons posted a £45m profit for the six months to the end of October, having made an £86m loss in the same period last year. Shares rose 12.3pc, or 13.4p, to 122p, meaning the stock has more than doubled since its 2020 low in March.

However, they are still down 15pc this year and the interim dividend, worth £52m last year, was cancelled.

AJ Bell investment director Russ Mould said: ‘Dixons’ sales of electrical products have been so strong that for once it doesn’t really matter that its mobile phone business continues to be horrific.’

Sales of electrical items rose 17pc to £ 4.5bn, boosted by a 145pc increase online, which added £800m of extra revenue over the half-year. Web sales more than offset busi ness lost from enforced store closures during lockdown and at Dixons Travel, which are in deserted airports and train stations.

The company has 300 stores. But with revenues at the mobile phone division down 54pc to £384m, overall group sales rose 3pc to £4.9bn.

The retailer’s chief executive Alex Baldock ( pictured) said: ‘We are winning online, and we’re not seeing any signs of demand tailing off. People are realising how i mportant a part technology can play in their lives.’

Computers, games consoles, smartwatches and coffee machines sold particularly well. Dixons has cut prices to compete with online rivals such as Amazon and AO World, and expanded its range from 12,000 to 17,000 products. It held off repaying £ 103m business rates relief and furlough cash saying there was a‘ long way togo’ in the pandemic. Bosses cited the cost of store closures, saying the two lockdowns hit sales by £ 320m and reduced profits by £155m. The phone business posted a 54 pc fall in sales following the closure of 531 stores this year, which resulted in 2,800 job losses. Consumers are avoiding pricey long-term deals. The shift left Carphone locked in its own expensive long-term contracts with mobile providers, which have taken years to escape.

Its deal with EE expired at the end of September, meaning its only remaining contract is with Vodafone. It launches its own mobile offer in 2021.

Dixons hailed a 25pc increase in revenues from shoppers buying items on credit, despite concerns over consumer defaults as unemployment rises. In total 1.3m customers used short-term consumer credit to buy, it said.

International revenues, mostly from Greece and Scandinavia, were up 16pc to £2.21bn, while profits rose by a third to £81m.