Colour picture phones drive growth at Carphone

Mobile phone handsets could be in short supply this Christmas, Carphone Warehouse chief executive Charles Dunstone warned yesterday.

Handsets in stock or confirmed for delivery would be sufficient if demand were similar to last year, he said, but should sales boom as they did in 2000, there would be a shortage.

Growing competition bet-ween networks and an array of new handsets would drive growth at least into the first quarter of next year, he said.

One factor is whether 3G handsets from Hutchison arrive. Mr Dunstone said: "They tell us we will get the handsets by Christmas. It won't be the end of the world if they don't turn up, but the delay is very frustrating. When we do get them they sell out in a matter of minutes."

Mr Dunstone claims handset makers overdid the gloom when placing orders for components in April and May, and there is now a shortage of screens, particularly colour ones.

He said: "The world is going colour screen crazy and the manufacturers can't keep up. The fighting between the manufacturers is over. Whoever can produce most will have the largest market share."

Carphone Warehouse rep-orted underlying profits up 68.8 per cent in the 26 weeks to 27 September. Pre-tax profit fell to £3.1m from £17.7m. Last year's figure was boosted by an exceptional gain of £13.2m. A maiden interim dividend of 0.4p will be paid.

Mr Dunstone said like-for-like sales in the core retail chain, which opens its 500th outlet this week, were up 15.5 per cent.

He described progress at the Opal fixed-line operation as impressive, with revenue up 52.4 per cent to £105.8m in the first half. The Talktalk service had exceeded expectations and a more aggressive rollout of the service was announced last month.

In Europe, Mr Dunstone said the highlights were France and Spain, which were becoming significant high-growth contributors to turnover.

Belgium was now profitable, as was Germany since the integration of the operations there with Hutchison, the German service provider acquired in June.

Non-British growth, exc-luding the Hutchison acquisition, was 43 per cent on top of a 47 per cent gain last time.

Mr Dunstone said he exp-ected to create a further 1,000 jobs over the next 12 months through new store openings and a call centre in Warrington.

The shares, which bottomed at 50p in March, added 3.25p to 133p yesterday. They are now around their highest level for two years.