(Alliance News) - Dixons Carphone PLC on Wednesday reported a boost in its online operations but again warned of GBP400 million in lost annual sales due to store closures and now has ruled out paying a final dividend.
The electrical goods retailer, which ends its financial year on May 2, said its UK & Ireland online operations "accelerated further, recovering around two-thirds of lost store sales".
The company's share price rose in the wake of the news, climbing 15% to 78.77 pence per share, the best performing stock in the FTSE 250.
Overall sales in the year to April 25 were up 2%, climbing 1% in the UK & Ireland alone. During that period, UK & Ireland online sales rose 22%.
UK & Ireland online sales soared 66% year-on-year in the 16 weeks to April 25, and in the final five weeks of that period, sales more than doubled.
Dixons Carphone added: "The UK & Ireland and Greek stores that are closed would normally have been expected to contribute a further roughly GBP400 million of sales in this financial year. In UK & Ireland Electricals, our online business has recovered around two-thirds of the lost store sales as we have adapted to changing customer needs, maintained our unambiguous price promise, continued investment in delivery and carried on growing our range for customers.
"In April we have seen strong demand for home office equipment including computers and home networking as people work and communicate remotely. Gaming and TV sales have also been strong. In kitchen products, refrigeration and food preparation including bread makers have sold particularly well. The latter part of the month has seen increased sales for personal care products and fitness trackers."
Sales of major domestic appliances fell, however, the company noted.
"Given the uncertainty and need to build for the future, the board has decided not to pay a full year dividend for the current year. Dividend payments will not be resumed until our standby debt facilities have been cancelled, which can be done at any time and is something we would plan to do when there is more certainty over the future," the company said.
Dixons Carphone added that it has secured an additional GBP266 million revolving credit facility.
"Measures to preserve liquidity were announced on March 26 and included government cost support, discretionary spend control, capital expenditure reduction, working capital control and government support of tax payment delay," the company said.
"These combined measures put the group in a robust position. We do not foresee needing to access any additional liquidity, and we expect to comply with bank covenants unless substantially all of our operations are required to close for an extended period."
In March, the company said it will close all of its UK standalone Carphone Warehouse high street stores. The measures would lead to 2,900 redundancies, the company explained.
The company added on Wednesday that it has furloughed 16,500 staff members and all executive and board members have taken a 20% pay cut.
Dixons Carphone will publish its full-year results on June 25.
By Eric Cunha; ericcunha@alliancenews.com
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