Dixons Carphone reports upbeat results as profits jump by 17%

As Dixons Carphone reports its full year results Helal Miah, investment research analyst at The Share Centre, explains what it means for investors.

“This morning, Dixons Carphone reported another year of profit growth as pre-tax profits rose 17% to £447m. Interested investors should also acknowledge that full year revenue was up 5% on a like-for-like basis however, this was slightly lower than consensus expectations.

“Looking ahead, the company is very upbeat for the remainder of the year expecting to find opportunities and additional growth from a number of new initiatives it is rolling out, despite the challenges and volatility levied by the UK leaving the European Union. Chief Executive Seb James said, ‘Our view is that, as the strongest player in our market and despite the volatility that is the inevitable consequence of such change, we expect to further consolidate our position as the leader in the UK market.’

“The result of the EU referendum means there is a greater risk of a short to medium term downturn for the UK economy which would probably affect retailers of more discretionary items such as Dixons Carphone. Nevertheless, we continue to recommend Dixons Carphone as a ‘buy’ due to the strong management and the benefits of scale provided by the merger. This is however, a company for investors willing to accept a higher level of risk.”