Dixons Carphone has declared that Black Friday is here to stay after the US-inspired discount day helped boost expected annual profits beyond forecasts.
In an update on Christmas sales, Dixons Carphone said a surge in demand on Black Friday had turned festive trading into a rollercoaster. Some retailers, including John Lewis, have said the 24-hour bargain spree on the last Friday of November needs to be reined in to restore order to pre-Christmas trading. Dixons Carphone’s finance director, Humphrey Singer, said the frenzy on the day took the company by surprise but that it was now a fact of retailing life.
“It was bigger than anybody expected but that’s just the way it is. I think it’s here to stay,” he said. “It’s one of those phenomena we have imported from our American cousins that we need to plan for and get used to.”
Like other retailers, Dixons Carphone said Black Friday distorted Christmas trading by creating a spike in sales as shoppers snapped up discounted goods early. Fights broke out at some shops and retailers’ websites, including Dixons Carphone’s Currys, creaked under the strain.
Singer said: “Overall, Christmas trading was strong with an exceptional Black Friday weekend. It was bigger than Boxing Day though Boxing Day was a record day. It was a bit quiet in the two or three weeks after Black Friday but that enabled us to restock to make sure we had more available for the last weekend before Christmas.”
The newly-merged retailer, created when Carphone Warehouse and Dixons joined together last year, said sales for the two months to 3 January at stores open a year or more rose 7%. As a result, pre-tax profit for the year ending 1 May will be between £355m and £375m, compared with analysts’ average forecast of £355m.
Sebastian James, the company’s chief executive, said: “The strange shape of this year’s Christmas trading was something of a rollercoaster but I am very pleased with the end result.”
Dixons Carphone benefited from the collapse of rival Phones 4u and the launch of the iPhone 6, Singer said. Other popular items were large TVs, whose sales more than doubled, coffee machines, juicers and high-speed blenders.
The retailer’s shares rose 1.8% to 450p in early trading.
