Currys Upgrades Profit Outlook for FY25, Shares React

January 15, 2025 07:11 PM AEDT | By Team Kalkine Media

Currys Upgrades Profit Outlook for FY25, Shares React — Image source: Shutterstock

UK & Ireland: Positive Growth Despite Challenging Market Conditions

Currys’ UK & Ireland segment saw a 2% increase in peak like-for-like revenue during the holiday period. The company achieved strong sales across key product categories, particularly in mobile, gaming, and premium computing. However, the overall performance was somewhat offset by weaker sales in the TV segment, which has faced softer demand.

One of the standout features of Currys' performance was its robust omnichannel sales growth. Order & collect sales increased by 13%, while online-in-store sales saw an impressive 24% growth. These figures highlight the continued shift towards digital and hybrid shopping experiences, underlining the effectiveness of Currys’ omnichannel strategy.

Nordic Region: Sales Growth and Market Share Gains

In the Nordic region, Currys saw a 1% increase in peak like-for-like revenue. Despite a generally soft market, the company achieved sales growth and gained market share across the region. The growth was particularly strong in domestic appliances and computing, with the company maintaining its focus on high-margin products.

In addition to the growth in sales, Currys reported continued improvements in its gross margin, reaching historically high levels. The company’s omnichannel efforts also paid off, with a 29% increase in order & collect sales YoY, further solidifying the impact of its digital-first approach in driving consumer engagement.

Strong Performance in Solutions and Services

Sales of solutions and services also performed well, contributing to Currys’ positive trading update. The "sold with" adoption rate grew by 7.8 percentage points to 41.1%, highlighting the increasing demand for bundled offerings. Meanwhile, credit adoption increased by 2.5 percentage points to 23.0%, reflecting a growing appetite for flexible payment options among consumers.

iD Mobile Subscriber Growth

Currys’ iD Mobile business showed impressive growth, with the number of subscribers increasing by 30% year-on-year to reach 2.1 million. The company added 0.5 million new subscribers in the last 12 months, continuing its strong momentum in the mobile sector.

Optimistic Outlook for FY25

Looking ahead to the full year, Currys has upgraded its profit forecast for FY25. The group now expects adjusted profit before tax to be between £145 million and £155 million, reflecting a 23-31% year-on-year increase and exceeding market consensus expectations. The company’s strong performance in the first half of the year, coupled with disciplined cost management and ongoing sales growth, underpins this positive outlook.

In addition to the profit upgrade, Currys is expected to generate growing free cash flow for the year, with further increases in future years. This strong cash flow performance positions the company well for future investment and growth opportunities. As a result, the Board intends to declare a final dividend of around 1.3p alongside full-year results in July 2025.

Following the update, share price of Currys jumped over 12% at the time of writing on 15 Januray 2025.

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