Carphone Warehouse's revenue dropped 4.8% to £756m during the quarter ended 2 July as the 'weak prepay market’ and ‘the shift to 24 month contracts’ affected sales.
The retailer today (26 July) reported that sales had dropped 3.3% and customer connections fell 5.5% to 2.5 million in the 13 weeks ended 2 July 2011 as prepay sales continued to slump.
Meanwhile, Carphone Warehouse also reported that its own store numbers across Europe had fallen by 2.5% to 2,167 but franchises increased 27.2% to 271, bringing the total store numbers to 2,438.
Carphone Warehouse CEO Roger Taylor said: ‘In the UK, as expected, the shift to 24 month contracts, and a continuing weak prepay market, affected Carphone Warehouse sales, but we saw an encouraging performance from continental Europe, as we continued to drive smartphone penetration across the CPW Europe estate. We remain excited about the opportunities provided by our ‘Wireless World’ store format, which is ideally suited to offer a wider range of products, including tablets – another area of potentially significant growth for the core retail business.
‘As stated in June we continue to evaluate the next steps in our multi-format/multi-channel consumer electronics strategy. ’
Meanwhile, the retailer said that the benefits of its ‘Wireless World’ store format were also evident in the Q2 results.
Carphone Warehouse claimed that the stores converted to date are producing ‘excellent customer feedback’ and ‘strong financial returns’ following the launch of new products and smartphone bundles.