Carphone sales fall short of forecasts (FT.com)

Carphone Warehouse, the mobile phone retailer and telecoms group, joined the growing band of consumer-facing companies that missed sales targets over the Christmas period as footfall fell across the high street.

The telecoms operator, which kept expectations for the full year unchanged after a strong performance from other parts of the business, said the environment was becoming more uncertain on the high street. Mobile phone sales grew 13 per cent to �650m over the third quarter, against expectations of 15 per cent. It was well below the 19.2 per cent of growth delivered across the second quarter. Underlying retail sales grew 1 per cent.

"Footfall was down at Christmas so you could put [the dip in pre-pay] down to that," said Roger Taylor, finance director, saying that the group sold 50,000-100,000 less phones than expected, equivalent to about �2m of profit.

However, he said post-pay was holding up well in the current economic climate as people opted to update handsets through changing tariffs rather than buying new phones. Retail subscription connections rose 16 per cent to 1.3m. He also said the strong growth in broadband connections offset the dip in retail sales.

"The economic climate will remain tough, but in uncertain times we have the revenue streams of fixed line and increasing post-pay sales so we are very happy with the outlook," said Mr Taylor.

Carphones shares have been hit in recent weeks, with investors concerned that the gloom among high street retail chains had fed through to Carphones performance. On Friday Carphones shares fell another 13p or 4.5 per cent to 291p.

However, the retail outlets have benefited this Christmas from being one of the few high street shops selling Apples much-hyped iPhones. Mr Taylor refused to disclose any hard figures on sales performance of the product, but did say the handsets had proved popular and had "undoubtedly increased footfall".

On another bright note, Carphone said it added 118,000 new broadband customers over the quarter, taking the total broadband base to 2.6m. It also said that net new customers in the second half would come in closer to 250,000 -- at the upper end of its 200,000-plus range. It has pledged to reach 3.5m customers by 2010.

Carphone is expecting to deliver sales of �1.3bn and pre-tax profits of �220m-225m in the year to March, againt �123m last year.