Carphone on track for a March split
CARPHONE Warehouse said yesterday that it signed up more broadband customers than expected in its second quarter, and that it is on-track to demerge the business in March 2010.
The long-awaited demerger of its telecoms and retail businesses has been delayed due to the problems of valuation during the economic downturn.
“The worst seems to be over… but there’s not much grounds for there to be a huge upturn in the economy either,” said Carphone’s finance director Roger Taylor, playing down hopes of a rapid recovery in consumer spending.
“We see this current consumer environment potentially sustained for another 12 to 18 months,” he said.
Carphone, the second-biggest UK broadband provider behind BT, said in its trading statement that it added a net 77,000 broadband subscribers to its TalkTalk telecoms unit in the period, beating forecasts of 41,000. It was boosted by its focus on the low-priced end of the market.
Its recently acquired Tiscali UK business lost a net 62,000 broadband subscribers, which Carphone said was in line with its expectations. The firm said it would receive a rebate on the originally agreed deal because of the loss of custom.
Customer connections at Best Buy Europe, Carphone’s retail joint venture with US electricals group Best Buy, were up two per cent to 3.17m, also just above forecasts.
Despite the stronger than expected numbers, Carphone kept its full-year guidance to increase earnings per share by 10 per cent, including the Tiscali deal.
Taylor also confirmed that Best Buy Europe would open the first of its megastores in April next year, with the first two opening in Southampton and Thurrock.