Dixons Carphone has issued a profit warning that has seen its shares plummet by 30%.
The company announced it expected profits to drop to between £360m and £440m, compared to £501m last year.
The company, which has 1,148 stores in the UK and Ireland and a further 991 across Southern Europe and the Nordics, said the reason for the warning was a result of the weakness of sterling making mobile phones more expensive and consumers buying new phones less frequently.
Seb James, group chief executive, said: “Currency fluctuations have meant that handsets have become more expensive whilst technical innovation has been more incremental.
“As a consequence, we have seen an increased number of people holding on to their phones for longer and while it is too early to say whether important upcoming handset launches or the natural life cycle of phones will reverse this trend, we now believe it is prudent to plan on the basis that the overall market demand will not correct itself this year.”
In its annual report released last month, chairman Lord Livingston of Parkhead said it closed 80 stores during the year but it was pleased with the results of the new three-in-one stores it had created uniting the Currys, PC World and Carphone Warehouse brands.
He said: “The future holds many opportunities and a few challenges and uncertainties. But we are well positioned. We have invested to make our stores best-in-class. We are market leaders in our key markets.
“We believe that the future will become more connected and more complicated. Customers will choose and buy through a mix of online and offline. We will be there with them providing technical know-how and unbiased independent advice together with the ever-important great prices, excellent service and great choice. Our job is to provide great value for customers and shareholders alike.”
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