(Alliance News) - Dixons Carphone PLC on Wednesday posted a double-digit sales rise ahead of the end of its financial year and the electrical goods seller revealed plans to close its travel retail arm.
The retailer said it does not expect "passenger numbers to recover" by enough to offset the UK government's removal of a scheme which allowed for tax-free shopping in airports. Dixons Travel will close a result.
"This has led to the difficult decision to close this business, which historically made an annual profit contribution of over GBP20 million," the FTSE 250 constituent said.
It follows the company's decision to close its Carphone Warehouse stores in Ireland.
Shares in the company were 4.1% lower at 151.00 pence each in London on Wednesday morning, one of the worst mid-cap performers.
In the 25 weeks to April 24, the company's electricals revenue was up 12%, helped by an 11% hike in the UK & Ireland arm and a 14% rise in the International unit. In the 51 weeks to April 24, revenue was 14% higher.
"Very strong online growth has continued in all markets with Group Electricals online sales more than doubling to over GBP4.5 billion for the year," Dixons said.
"Given the strong financial position, the group has reimbursed all government support for the GBP73 million of furlough paid to UK & Ireland colleagues during the year."
After paying back the support, it expects annual adjusted pretax profit to be largely in line with consensus of GBP151 million, down 9.0% from GBP166 million a year earlier.
Looking further ahead, the company is "on track" to deliver on its GBP1 billion cumulative free cash flow target by financial 2024. In financial 2022, it expects to incur GBP130 million in exceptional costs related to business closures.
By Eric Cunha; ericcunha@alliancenews.com
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