Carphone Warehouse in revenue boost

CARPHONE Warehouse has upped its full-year forecasts for the second time in a matter of months after strong trading at both its retail and broadband arms during the third quarter.

The FTSE 250 group, which is splitting into two businesses in March, says earnings per share to the end of March are likely to be at the top end of the existing 14p to 15p range – up from 12.6p a year ago.

Its telecoms business TalkTalk reported a 29 per cent jump in total revenue for telecoms business to £446m for the three months to 31 December.

The division added a further 36,000 customers during the three months to 31 December – slightly above analyst expectations.

It now expects to have between 4.1m and 4.2m broadband customers by year-end – at the top end of its guidance.

Carphone said growth within its TalkTalk brand, which officially sponsers the X-Factor, is offsetting falling numbers of former Tiscali customers following the acquisition of its Italian rival in July 2009.

Europe's biggest mobile phone retailer, which has over 2,400 stores in nine countries, also saw a 5.5% rise in like-for-like revenues at its joint retail venture with US giant Best Buy.

This led it to raise its guidance for its share of Best Buy Europe's net income to between £40m and £45m from earlier forecasts of the top end of the £30m to £40m range.

High demand for smartphones in the UK and US helped to offset the effects of a weaker performance in mainland Europe.

Chief executive of Carphone Warehouse Charles Dunstone, said: "TalkTalk Group's brand profile, value for money proposition, and customer service have continued to generate real momentum in the market.

"Whilst we are cautious about the economic environment in the year ahead, Best Buy Europe is well positioned operationally for further growth in the UK, Europe and the US."

He added that the Tiscali integration remains well on track while the demerger is set to be completed by the end of March.

Carphone is paying a special dividend of 3.2p per share to investors in March to replace its scheduled final year dividend in July 2010.