Dixons Carphone has reported a 22 per cent drop in full-year profits and warned of “more pain” to come from its UK mobile sales.

The mobile and electrical retailer made an underlying pre-tax profit of £298 million during the year to 27 April, which comes in below guidance of around £300 million and is also down from the £382 million in achieved in 2017-2018.

The group predicted underlying pre-tax profit would likely come in at around £210 million during the 2019 to 2020 period. After that, it expects to see the benefits of turnaround plans beginning to feed through.

Group chief executive Alex Baldock explained that in response, legacy network contracts have been renegotiated, a new customer offer is being developed, and the integration of mobile and electricals into one business is being accelerated.

“This means taking more pain in the coming year, when mobile will make a significant loss.”

Baldock continued: “Overall, with investment in our transformation underpinning UK and Ireland electricals and International growth in sales and headline profits, and accelerating the changes in mobile, we’re confident to bring forward our long-term ambitions.”

In December, the group posted a £440 million pre-tax loss for its half-year to 27 October, compared to profits of £54 million for the same period the year before. It attributed those results to charges of £490 million, largely due to a write-down on the value of its loss-making Carphone Warehouse mobile business and store estate.

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