Carphone Warehouse boss Charles Dunstone has described the future of mobile sales, starting with Christmas prepay sales, as the “most challenging we have operated in”.
But he said Carphone’s position, both its retail joint venture with US electronics form Best Buy and its TalkTalk fixed line and broadband service, will withstand an economic buffering because of the financial stability of the group.
He said: “The next 12 months are likely to represent the most challenging economic climate we have ever operated in. With little debt and £900 million of facilities, the Group is very well positioned to withstand the financial turmoil.”
Dunstone said the £2.2 billion joint venture with Best Buy in Europe sees Carphone operating with little debt and £900 million of facilities. He said current TalkTalk offers, as well as the review of the group structure, which could see TalkTalk demerged as a standalone entity to demonstrate asset value for shareholders, will also see it through turmoil in the global economy.
He said: “My focus will be on supporting our customers, protecting our employees and using our resources to position ourselves in the best way for the recovery when it finally comes.”
Dunstone added: “The immediate consumer outlook remains very uncertain. In the short term, Best Buy Europe is well positioned relative to its competitors, with an excellent line-up of exclusive products as we approach Christmas.
“So far this year, we have outperformed our expectations in subscription connections, but underperformed in pre-pay. As the Christmas marketplace has proportionately a much higher pre-pay share, predicting the outcome of the next six weeks of sales is very difficult.
“Further out, the development of our big box consumer electronics format is an exciting new growth avenue for the business.
“The TalkTalk Group is well positioned in a market that is now highly penetrated, offering clear value to customers from a highly efficient network infrastructure.
“We are meeting customers’ growing demands for value and flexibility as household budgets come under pressure, as our new propositions announced today demonstrate.”