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* Q1 UK & Ireland mobile underlying sales down 10%
* UK & Ireland electricals underlying sales up 2%
* Full year guidance maintained
* Shares up 1.7% at 0723 GMT, down 29% year-on-year
LONDON, Sept 5 (Reuters) - Britain's Dixons Carphone
on Thursday reported another big fall in mobile phone sales in
its latest quarter, though it maintained its financial guidance
for the full 2019-20 year and said its turnaround was on track.
Dixons Carphone has been hurt by a shift in the mobile phone
market as customers keep their handsets for longer, choose
cheaper SIM-only deals, and turn to more flexible credit-based
offers.
In June the group said it would accelerate its response to
the changing mobile market after reporting a 22% slump in annual
profit and warned of another big fall in the current year.
The group, which trades as Currys, PC World and Carphone
Warehouse in Britain, said like-for-like sales in its UK &
Ireland mobile phones division fell 10% in the 13 weeks to July
27, its fiscal first quarter, having fallen 4% in the last
financial year.
"The mobile market is as challenging as expected,
underlining the need for the decisive actions that we set out in
June," said Chief Executive Alex Baldock.
Baldock has renegotiated all of the group's legacy contracts
with network providers Vodafone, EE and O2
. He is also revamping the group's mobile product range,
including improved choice in SIM-only deals and flexible credit
based bundles.
Its shares were up 1.7% at 0723 GMT, paring losses over the
last year to 29%.
"TROUGH YEAR"
Dixons Carphone said first quarter like-for-like sales in
its UK & Ireland electricals division rose 2%, while sales in
its international division on the same basis were up 4%. Overall
group like-for-like sales were flat - in line with analysts'
consensus expectations.
"The current political and economic climate is volatile but,
assuming no material disruption from that, we stand by our full
year guidance," added Baldock, who expects 2019-20 to be "the
trough year" for mobile losses.
Industry data published on Tuesday showed British retailers
saw their sales flat-line in August as shoppers cut back on
non-essentials.
Economists say recent signs of a weakening in spending by
households raise the risk of a recession as the country prepares
to leave the European Union.
Guidance is for a group underlying pretax profit of around
210 million pounds ($258 million) in 2019-20, down from 298
million pounds made in 2018-19.
"As the year progresses, we will be able to assess more
fully management's delivery against the early stages of its
plan," said Liberum analyst Adam Tomlinson.
"Success here could generate some positive momentum in the
shares."
($1 = 0.8145 pounds)
(Reporting by James Davey, Editing by Paul Sandle and Emelia
Sithole-Matarise)
