By James Davey
LONDON - Robust demand for supersized televisions, gaming sets and smart technology helped British retailer Dixons Carphone <DC.L> to outperform a weak UK market over the key Christmas period, keeping it on track to meet its financial targets.
Shares in the group, which trades as Currys, PC World and Carphone Warehouse in Britain, rose 4.9% to 149.3 pence by 1012 GMT on Tuesday, extending gains over the past year to 8.7%.
"Dixons Carphone must have been a prime candidate for a profit warning, but the company has wriggled off the hook, thanks to strong market share gains," said independent retail analyst Nick Bubb after the company stuck to the financial guidance it issued last month.
Official data published on Friday showed that British consumers failed to increase their spending for a record fifth month in a row in December, adding to signs of economic weakening that might prompt the Bank of England to cut interest rates this month.
Dixons Carphone said growth in UK electricals and its international division offset continuing declines in mobile phone sales in its home market.
"The supersizing trend in TVs shows no sign of running out of steam," Chief Executive Alex Baldock told reporters, noting that the company's sales of 65-inch TVs jumped 75% year on year.
He also highlighted strong sales of Apple AirPods, Nintendo Switch gaming sets and smart technology such as Fitbit wearables, enabling the UK & Ireland electricals division to report a 2% rise in like-for-like sales over the 10 weeks to Jan. 4.
Baldock said Dixons Carphone won market share in an overall electricals sector down more than 3%.
Having taken the helm in April 2018, Baldock is leading a programme to turn around Dixons Carphone after it was damaged by a shift in the mobile phone market as customers keep their handsets for longer, choose cheaper SIM-only deals and turn to more flexible credit-based offers.
His plan is to focus on the group's core electricals division while revitalising the mobile phones business. He also wants to bring the retailer's stores and online operations closer together and develop its credit business.
Group like-for-like sales growth was zero, against analyst expectations of a 1% fall and a 2% decline in the second quarter.
"We've had a good peak in a weak UK market and we're on track to deliver what we promised for this year and with our longer-term transformation," Baldock said.
He dismissed a weekend media report that the group could pursue a merger with Germany's Ceconomy <CECG.DE>.
"I can honestly say we've got plenty to do with this transformation of ours and that's what I'm focused on," he said.
($1 = 0.7691 pounds)
(Reporting by James Davey; Editing by Kate Holton and David Goodman)