Carphone shares jump on Best Buy news
Smartphones push earnings as CPW raises targets
Carphone Warehouse shares are up almost nine per cent in early trading on news that the mobe reseller is raising targets after a strong first six months trading.
CPW said smartphones and interest in the "Connected World" helped increase sales in the first six months.
The company expects earnings per share of between 13.5 and 14 pence per share - up from 11.5 to 11.9 pence previously.
But the company expects a larger loss for Best Buy UK - in the region of £50 to £55m for the year.
Revenue for the six months ended 30 September 2010 was £1.67bn, down very slightly on 2009. But profit before tax was £103m compared to £79m for the same period last year.
Carphone Warehouse grew revenue 2.4 per cent but Ebitda (profit after bad things excluded) grew by 56 per cent to £44m.
The real star performer was Best Buy Mobile US, which made a profit of £43m in the period and now expects full year earnings of £85m to £95m – compared to the £53m to £55m predicted previously.
Response to the firm's joint venture with Best Buy in the UK has also been encouraging.
Roger Taylor, chief executive, said: "Customer response to our first five Best Buy branded 'Big Box' stores has been overwhelmingly positive, with the sixth store opening in Derby today. With yesterday's launch of its transactional website, Best Buy gains national reach and is able to compete as a truly multi-channel retailer."
In France the joint venture with Virgin Group - Virgin Mobile France - had a reasonable year but was focused on integrating Tele2. It still expects to add 50,000 to 100,000 customers over the full year.