Dixons Carphone plunges as ‘nail-biting’ Christmas nears

Dixons Carphone boss Seb James today braced for a “nail-biting” Christmas as he watched shares in the firm tumble more than 6% and languish at the bottom of the Footsie leaderboard.

The retailer reported a 4% rise in same-store sales and a 19% rise in pretax profit in its first-half but analysts and traders said a mix of factors had dragged the stock down.

Among them was a warning that suppliers could increase prices because of sterling’s weakness and suspicions that same-store sales figures, up 5% in the UK and Ireland, may have been flattered by sales transferred from closed stores.

Mainly, though, it was an opportunity to take profit. Dixons Carphone shares have risen by a fifth in recent weeks, though they are 17% lower than they were before the Brexit vote. Today shares were down 22.8p to 344.5p.

James was upbeat on the group’s prospects amid strong UK demand. But he expected the lead-up to the Christmas peak to be tense, despite the company seeing its biggest ever Black Friday event last month.

“It’s nail-biting until January 5. I have heart-stopping moments but every year it has turned out fine. I think we’ll have a good Christmas.”

James also promised to minimise the effects of sterling’s tumble for customers. Suppliers such as Microsoft, Dell and Apple have already indicated prices could rise because of the currency’s swing and rival AO World has pointed to increases by the end of January.

James said the scale of Dixons Carphone, which also trades in the Nordics, Greece and Spain, meant it could negotiate with suppliers. “We are gigantic and have very important Europe-wide relationships with suppliers. My predecessor moved relationships to be much more like partnerships so when things like this happen there can be collaboration.”

But he admitted the company was planning for uncertainty and “preparing for all eventualities”. “We have no idea what will happen next year, but we’re just going to roll with it and whatever happens we will be fine.”