(Alliance News) - Dixons Carphone PLC on Wednesday resumed dividend payments as online sales rescued a year that saw its stores forced to close by lockdown restrictions.
For the financial year that ended May 1, the electronics retailer swung to a pretax profit of GBP33 million from a GBP140 million pretax loss last year on revenue of GBP10.3 billion, up 1.0% from GBP10.2 billion.
Dixons Carphone restarted dividend payments after they were suspended in April 2020, declaring a payout of 3.0p per share. The FTSE 250 company said it expects dividends to grow in the medium term. In the 2019 financial year, it paid out 6.75p per share.
Shares were down 0.5% to 122.30 pence in London on Wednesday morning.
Financial 2021 revenue was buttressed by online sales of GBP4.7 billion. In the UK & Ireland Electricals unit, online sales more than doubled in its most recently ended year, and jumped 79% in the international business.
But sales plunged 55% at the UK & Ireland Mobile unit after the company closed its small Carphone Warehouse stores permanently, while large stores were forced to shut in lockdown. The unit will become profitable by financial 2023, the company said.
"Dixons Carphone continues to emerge as not only a retail survivor of the pandemic, but potentially one of its winners," said Stuart Lamont, investment manager at Brewin Dolphin.
"Restarting the dividend is a milestone moment for the company, supported by growing sales, a strong balance sheet, and the transformation of its mobile division – even if the latter is still a hindrance to current performance."
Looking ahead, Dixons Carphone expects an operating profit margin of at least 4.0% by 2024. It also expects positive cashflow from the UK & Ireland Mobile unit over 2021 to 2024 to be at least GBP200 million, up from the previously guided GBP125 million to GBP175 million range.
The London-based company's various UK brands, including Currys PC World, Carphone Warehouse and Team Knowhow, will be renamed to the single brand of Currys by October 2020.
"The start of the financial year has seen continued strong trading in all our markets and I'm more confident than ever in our prospects," Chief Executive Officer Alex Baldock said.
By Ivan Edwards; ivanedwards@alliancenews.com
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