CPW broadband targets feel the crunch
It's the economy, silly
Carphone Warehouse has disappointed investors by reporting lower than expected broadband connections in the last three months. Its shares tumbled more than eight per cent this morning.
The firm attracted 109,000 new punters, well short of the 128,000 that City analysts had decided it ought to be aiming for.
Group chairman and CEO Charles Dunstone blamed a "tough consumer environment" in the wake of the credit crunch. He said Carphone would improve efficiency, including migrating AOL customers to its fully unbundled network later this year, and slowing growth of its retail empire.
Net debt for the group was also hit by the worsening economic climate, and a higher than intended investment in building out its LLU network. Currency movements have cost Carphone £120m.
Business was better for the group's mobile tentacle, with a 12 per cent rise in total connections. Dunstone said: "Our performance over the last three months has been good in a slower consumer environment."
No mention was made of Carphone's involvement with Phorm.
The firm set itself a target of 400,000 new broadband customers this year, as it guns for 3.5 million in 2010. Its trading update is here. ®