Currys Share Discussion Threads

[givememymoneyback] 12/8/2019 08:24

Something wrong with the url when I paste it in - type tt to replace the xx right at the beginning or just google search the headline if you want to see it online. A few observations on this court case though:
1. It looks like the commercial relationship between DC and Telefonica has broken down - not good for future sales
2. This looks like a fairly significant hit to DC profits but I don't remember seeing this in the recent profit warning. Can someone tell me if they've reported it, or if we're going to seeing a new profit warning?

[givememymoneyback] 12/8/2019 08:17

On Sunday the following appeared in the Sunday Times. I didn't know that this was what DC had in mind when they said they'd renegotiated contracts:

hxxps://www.thetimes.co.uk/edition/business/carphone-warehouse-sues-telefonica-over-21m-shortfall-vnqgcqtxd
Carphone Warehouse sues Telefonica over £21m shortfall
Carphone Warehouse is suing the Spanish owner of O2, claiming the mobile network caused it to suffer a £21.7m shortfall in profits by breaching its obligations.
The retailer has issued a High Court writ accusing Telefonica of failing to make enough special offers available, refusing to hand over customer data and offering “uncompetitive” standard tariffs.
Carphone Warehouse — part of FTSE 250-listed Dixons Carphone — alleges that this stopped it hitting sales targets agreed with O2. As a result, the retailer claims, it lost £9.6m of profits plus £4.5m it would have received from Telefonica for achieving targets.
Telefonica allegedly said it would make special-offer tariffs available only if Carphone Warehouse accepted a cut in its share of sales, which it refused to do.
In addition, Carphone Warehouse claims that Telefonica reneged on a deal to pass on details of customers eligible for upgrades so the retailer could target them with advertising. It claims this cost it another £7.6m in lost profits.
Carphone Warehouse is seeking damages, lost profits and interest from Telefonica. The network giant said it was “disappointed” that the chain had started legal action “in the context of our wider commercial relationship”.
The Madrid-based company added: “We do not accept Carphone’s allegations and we will be vigorously defending the claim.”

[tim 3] 10/8/2019 21:06

AO can barely make a profit without the costs of stores!

There could be value in a merger which might save on costs but I suspect DC will be very wary after the Carphone merger which is still not fully integrated, and has hardly been a responding success with the mobile side currently loss making!

[buywell3] 10/8/2019 19:44

MM's leave it at 111

What a bunch they are ………; hilarious

Wait till 66.6 comes

[stdyeddy] 10/8/2019 13:23

Only if AO World would like to take on the challenge of redundancies for DC's vast workforce (42,000), ending leases on hundreds of stores, and making good on DC's massive pension deficit. Essentially the baggage of a twentieth century business. Not sure why an online lean modern business would want do that.

[septimus quaid] 09/8/2019 20:01

only thinking aloud, any logic to a merger with AO World?

[tim 3] 09/8/2019 16:12

Gone are the days they can simply increase prices to cover things like exchange rate fluctuations or similar margin pressures.Nowadays with the internet it's all based on being priced to sell and that's dependent on the competition so unless others put their prices up neither can they without having a big impact on volume.I know at one time to remain competitive margins on laptops dropped so much it was close to zero and they only made money selling add ons hence the hard sell!

[givememymoneyback] 09/8/2019 15:52

Short position on shorttracker is increasing, so looks like I'm in good company here. 3 hedgefunds shorting.

Also the drop in the pound is almost 5% since I first started looking at DC. As far as I can tell, practically every product they sell is imported, so the drop in sterling means that they are having to pay more for stock and either:
1. Make less profit on every hardware and software item (by absorbing some of the cost increase) or
2. Put prices up and suffer lower sales.
Everything looking negative for now, unless someone can tell me differently.

[givememymoneyback] 26/7/2019 15:24

I'm a bit puzzled by the rise here and I'm thinking about shorting.
A few things are on my mind, and I'm hoping for a sanity check from people here (quiet board -- maybe no one?)
Anyway, here's what I'm thinking:
Overall trend is down -- DC seems to be a predominantly bricks&mortar business, large employed permanent staff and all the costs that go with it. Big premises with very few customers in them, whenever I've dropped in. Retail generally is reporting sustained decline.
Online -- lots of competition
All the fundamentals seem to be heading down (profit negative, cash flow -- by almost half?)
There's a massive slug of goodwill and intangibles on the balance sheet, amounting to about £3.2bn. I'm making the net asset value negative by over £1/2bn -- am I missing something on this?
Interest on debt has gone up by 4m from 19 to 23 (20% more?)
The retirement costs seem to have gone up drastically by £46m a year for the next 9 or 10 years (over 10% of the headline profit each year).
The chief exec is forecasting 'more pain' in the future for the business.
So as far as I can make out, the future looks bleak. I noticed that a lot of the board bought shares at the last drop in the sp, and this month the share price is up by over 10% so far.
What's the view of people here on this board?

[knowing] 12/7/2019 15:47

Holding these long term and adding to PHD too. Good rewards to those who have patience

[knowing] 12/7/2019 12:22

Very strong today. Tucked a few PHD away too for the long term

[tim 3] 02/7/2019 18:43

Looking at the current deals Carphone now do now seem to be competing with the online operators.First time I have seen this they are usually more expensive sometimes by a fair amount.

Also like the new "switcheroo" campaign.

It does however highlight the fact that the operators are supplying packages that CPW will use to directly compete with their own direct sales as more people than ever buy direct from operators online or in their own stores which is obviously more profitable for the operators as they don't need to pay a commission.

This has to be a worry moving forward.

[markycrispy] 24/6/2019 15:24

Difficult market but They have a good online presence so should provide some good value moving forward.Another profit warning though could be disaster so would not over expose myself to anything but the small position I have

[hades1] 24/6/2019 14:29

Should get a bounce as rather oversold

[tim 3] 24/6/2019 10:50

Falling back this quickly is worrying for the bulls.

[mjk99] 24/6/2019 10:38

Still see this dropping lows of 80p before making any recovery. As outlook remains bleak. With more pain coming from mobile division.

[tim 3] 21/6/2019 17:26

Encouraging.

[knowing] 21/6/2019 17:20

Tell the Directors

[ny boy] 21/6/2019 16:26

Dead cat bounce

[salpara111] 21/6/2019 15:56

As mentioned above, the forward looking statement is pretty weak. They are effectively chasing a dying market. The only people I know who go into a physical store for their mobile needs are over 70, everyone else just shops online, occasionally using the stores as a show window to look at physical product before buying on line.
I had them on my watch list prior to the results but am now taking them off.

[tim 3] 21/6/2019 15:02

You make some good points.As I said last night I thought today would be important.Without the follow up from yesterday's buying I think a re test of a pound and probably 90p is likely.

[stdyeddy] 21/6/2019 12:31

I think the problem here is the explicit statement by the CEO that there is more pain ahead. Plus retail in general is declining. DC has a massive bricks and mortar investment and thousands of people to pay. Two years before breakeven for the phone side? That's a very long time for investors to be patient. Meanwhile competitors crowd the online tech and whitegoods market. I know none of the posters on here will agree, but I think this is likely to fall further today and Monday and possibly further into the future.