Tablet tactics at Carphone Warehouse

SHARES in Carphone Warehouse leaped nearly eight per cent to 338p yesterday as the mobile phone retailer revealed it was on target to meet year-end expectations, despite the lagging pay-as-you-go trade, and laid out plans to penetrate the tablet market.

The company behind advertising ploy “Mobly”, the animated mobile phone, estimated the UK-wide pre-pay market dropped as much as 40 per cent in the third quarter, due to the weak consumer environment and a lack of smartphones available on this payment plan.

Like for like revenue at Carphone Warehouse dropped 4.7 per cent, with connections down 16.6 per cent.

However, the quarter was rescued by a growth in contract payment plans carried by the range of new smartphones released in recent months.

A 15.3 per cent growth from the phone group’s 47 per cent stake in Virgin Mobile France contributed €109m (£91m) to the quarter.

Carphone Warehouse identified expansion into the non-cellular market – by tapping into sales of tablets, apps and accessories – as one of its “key opportunities” for growth. Revenue in this area rose 15 per cent year on year, but contributed just ten per cent of total group revenue.

The company currently has 294 Wireless World stores dedicated to this purpose across Europe and intends to roll out another 81 this quarter.