No Brexit blues for UK's Dixons Carphone
By James Davey LONDON (Reuters) - Dixons Carphone, Britain's biggest consumer electricals and mobile phone retailer, beat forecasts for first quarter sales on Thursday, adding to the list of companies that say their consumers seem unfazed by the Brexit vote. Shares in the company, which trades as Currys, PC World and Carphone Warehouse in the UK and Ireland, have fallen 12 percent in the last three months given its exposure to big ticket goods, and perceived vulnerability to any slide in consumer demand. But in the 13 weeks to July 30, Dixons Carphone, which also trades as Elkjop and El Giganten in Nordic nations and Kotsovolos in Greece, boosted sales at stores open more than a year by 4 percent, ahead of analysts' average forecast of 2.5 percent thanks to strong sales of mobiles, televisions and domestic appliances like cookers and vacuum cleaners. Dixons' shares were up 4.2 percent at 389.5 pence at 1041 GMT. "Dixons Carphone’s robust revenue growth is impressive, all the more so given macroeconomic headwinds in its core UK, Nordic and Southern European markets," said George Salmon, equity analyst at Hargreaves Lansdown. While Britons' vote in June to leave the European Union stunned financial markets, they have since recovered and UK consumers, who drove the recovery after the financial crisis, seem to have largely taken the referendum result in their stride too. Retailers including department store John Lewis, home improvement firm Kingfisher and fashion retailer Next, have all reported no change in consumer behaviour. Data has similarly suggested Britain's broader economy has not suffered the devastating impact that some "Remain" supporters forecast before the June 23 referendum, although some economists say it is heading for a sharp slowdown. "We're not experiencing anything at the moment, we're full steam ahead for peak (Christmas) and Black Friday (Nov. 25). If the consumer environment changes then we'll trim our sails to match," Dixons Carphone Chief Executive Seb James said. "We've just got to take the world as we find it. We're absolutely on the lookout and preparing ourselves in case something like that should happen," he told reporters. "But at the same time there's a risk it could become a self fulfilling prophecy – if you start reducing your stock intake or all those things, you can make what wouldn't otherwise be a problem a problem." James also pointed out that Dixons Carphone sources over 90 percent of products sold in Britain in sterling, limiting its exposure to the post Brexit depreciation versus the dollar. The retailer's like-for-like sales in the UK and Ireland were also up 4 percent, again beating analysts' consensus of up 2.5 percent. They were up 2 percent in the Nordics and 13 percent in southern Europe, driven by demand for fans and air conditioning units in Greece. Before Thursday's update analysts were forecasting an underlying pretax profit 462 million-505 million pounds for 2016-17, up from 447 million pounds in 2015-16. (This story corrects CEO Seb James quote in paragraph 9 to "trim our sails" not "trim ourselves") (Reporting by James Davey and Sarah Young,; editing by Kate Holton and Ruth Pitchford)
