Dixons Carphone to close standalone stores; 2,900 jobs to go

(Sharecast News) - Dixons Carphone said on Tuesday that it will close its 531 standalone Carphone Warehouse stores in the UK as it focuses on selling mobile devices and connectivity through Currys PCWorld stores and online.
The company said the move was "an essential next step" in returning the mobile business - which will make a ?90m loss this year - to profitability.

The small standalone stores, which represent 8% of Dixons Carphone's total UK selling space, will close on 3 April. It is expected that almost 40% (1,800) of affected staff will take new roles internally, but there will be 2,900 redundancies as the businesses are brought together.

Dixons said it was on track to meet its FY2019/20 adjusted pre-tax profit guidance of ?210m despite the headwind to profit from Dixons Travel and currency translation, as well as for net debt to be lower year-on-year, but that it was "aware the situation may change over the final weeks" of the year.

Chief executive Alex Baldock said: "Clearly, with unsustainable losses of ?90m expected this year, Mobile is currently holding back the whole business.

"But though this is by far the toughest decision we've had to make, it is necessary. We must follow our customers. They want help with all technology, all in one place, and this trend is only going to accelerate in a more connected 5G world."

Dixons said it had not yet been materially affected by the outbreak of Covid-19.

"The turbulent times ahead underline the importance of acting now and staying on track with our longer-term omnichannel transformation of the group. We are aware that our stores could experience a significant reduction in sales in the months ahead and we are modelling a range of downside scenarios and planning accordingly," it said.