Technology retailer Dixons Carphone claims that its UK mobile business "needs addressing" after profits plummeted by almost £100m.
Group revenues increased by one per cent in local currency to £4.87bn during its fiscal H1 ending 28 October, while EBIT decreased by 50 per cent year on year.
The firm's spiralling profits stemmed from its domestic UK business which saw EBIT fall by £96m year on year due to a "challenging" mobile market.
CEO Seb James said that rising handset costs have discouraged consumers from replacing existing devices, but pledged to address Dixons Carphone's UK profitability "in due course".
"The UK postpay mobile phone market is tougher, with a combination of higher handset costs and relatively incremental technology growth continuing to cause customers to hold on to their handsets for longer and some to choose a subscriber identity module only (SIMO) contract in the meantime," he said.
"In addition, the later launch of the iPhone X pushed some sales into the second half of our financial year. Throughout the period, we made a very conscious decision to fight hard to drive sales in our product offering, and this has impacted mobile profitability."
He added: "We recognise that the performance of the mobile division needs addressing, and are taking action to adapt our model in order to cement our place in a changing world. We will update the market on these developments in due course, but we believe that we can, over time, reduce the complexity and capital intensity of our mobile business model, and increase the simplicity and profitability of what we do."
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