3rd Quarter Trading Statement

Carphone Warehouse Group PLC
22 January 2003



Wednesday 22 January 2003

Strictly Embargoed until 0700 hours



                        The Carphone Warehouse Group PLC

                        Third Quarter Trading Statement


The Carphone Warehouse is pleased to announce that trading in the third quarter
as a whole, and over the Christmas period, was strong across the group, in line
with expectations. In addition, 2003 has started very positively, and the group
is well positioned to meet market expectations for the current financial year.

Third Quarter - 13 Weeks Ended 28 December 2002

Strong performance from Retail

  • Like for like gross profit +6.9% and like for like revenues +9.1%
  • Connections* up 16.3% to 1,332,000
  • Subscription connections up 7.2% to 530,000
  • Gross profit per subscription and pre-pay connection held firm

Recurring revenue streams (excluding Opal) increased by 19.1%

  • Our own customer base increased by 10.0% to 176,000
  • Facilities management base increased by 14.8% to 976,000
  • Insurance base increased by 15.8% to 1,076,000
  • Opal revenues for the two months to 31 December 2002 increased by 55% to
    £28.1m

Christmas Trading - 4 weeks to 28 December 2002

  • Like for like gross profit +7.8% and like for like revenues +14.0%

  • Connections* up 11.1% to 590,000
  • Subscription connections up 8.8% to 194,000

Current Trading - 3 weeks to 18 January 2003

  • Connections* up 21.8% to 281,000
  • Subscription connections up 14.0% to 118,000



* including SIM-free sales



Charles Dunstone, Chief Executive Officer, said:

'The Carphone Warehouse has had a good Christmas and a good third quarter,
continuing the growth that we achieved in the first half. Coupled with a very
promising start to January, this positions the group well to deliver profit
before tax in the current financial year in line with consensus market
forecasts.

'We achieved strong connections growth across the group, stimulated by new
handsets, new services, and the return of some subsidy into the pre-pay market,
as we highlighted in our interim results. Particularly notable was the growth in
our businesses in The Netherlands, Spain, Sweden and Switzerland, which together
represent almost 20% of group connections. I believe this demonstrates the speed
at which many of our non-UK businesses are building scale and profitability,
which is very encouraging for the future.

'Importantly, this growth did not come at the expense of margin. Over the
quarter our gross profit on subscription and pre-pay connections remained in
line with the previous year. Furthermore, we were pleased to increase the rate
of subscription connection growth from 3.6% in the first half to 7.2% in the
third quarter and 8.8% in December. Growth in subscription connections is
central to our strategy of earning an increasing share of the lifetime value of
each customer.

'Our recurring revenue businesses continued to record healthy growth, and this
should be supported going forward by the pick up in subscription connection
growth from the first half. Our ability to generate high margin, repeat revenues
from our customers after the point of sale is an important point of
differentiation between The Carphone Warehouse and its competitors, particularly
in a low growth handset market, and improves the quality and resilience of our
earnings.

'In its first two months within the group, Opal has continued to grow its core
business strongly. Revenues increased 55% year on year to £28.1m. The
integration is progressing well and we are excited about the impending launch of
our new residential fixed line service.

Christmas Trading

'Our like for like performance over the Christmas trading period was stronger
than the third quarter as a whole. We achieved good growth in like for like
sales and gross profit in our core UK market. Excluding SIM-free sales, which
were down on December 2001, our UK connections rose by 7.6%. Our non-UK
businesses traded very strongly, and across the group we continued to see a
sharp improvement in subscription connections.

Launch of Residential Fixed Line Service

'We will be formally launching our residential fixed line telecoms service in
all our UK stores next month. The ability of customers to switch their fixed
line calls from BT, to do so simply and rapidly, and at lower cost, has been
transformed through automated Carrier Pre-Selection. We believe that as a
trusted mobile telecoms adviser connecting over 2 million customers in the UK
each year, The Carphone Warehouse is uniquely placed to offer compelling rates
and deliver significant savings on customers' existing home phone bills.

Current Trading and Future Prospects

'2003 has started well. Overall connections are up 21.8% in the first three
weeks, and subscription connections are growing at 14.0%. Whilst this is against
a relatively weak comparable period, the growth in subscriptions highlights our
differentiated offering and remains central to our strategy of building
recurring revenue streams, a significant element of which is derived from these
higher value customers.

'The new product pipeline is healthier than it has been for some time. We are
confident that the increasing popularity of camera phones and picture messaging
services, supported by the progressive development of network interoperability,
as well as the wider adoption of colour screens, will help drive customer demand
for new handsets. In addition, the launch of a commercial 3G service in the UK
may further stimulate the market.

'Our aim is to continue to gain market share profitably through offering the
best advice and the widest choice to customers, and delivering high value
customers to the networks, thus continuing to improve earnings visibility
through our recurring revenue businesses. 2002 was a successful year in these
respects, and we intend to build on this in 2003.'



Conference Call

There will be a conference call for analysts at 9.30 am today. The dial-in
numbers are as follows:

Calls within the UK: 0845 113 0050

Calls from outside the UK: [phone]

A recording of the call will be available for replay for seven days. The dial-in
numbers are as follows:

Calls within the UK: 0845 245 5205

Calls from outside the UK: [phone]

Access number: 857674#



Enquiries


The Carphone Warehouse Group PLC

Charles Dunstone

Roger Taylor                                   020 8753 8200

Peregrine Riviere                              020 8753 8041

Vanessa Tipple                                 07947 000 021

Citigate Dewe Rogerson                         020 7638 9571

Anthony Carlisle                               07973 611 888


www.carphonewarehouse.com








Operating and Financial Statistics

  • Connections, mix and store numbers

                      13 weeks to 28 December 2002        4 weeks to 28 December 2002              Year to date

                             2002           2001                2002          2001                2002          2001
Connections
UK                           711,000        661,000             310,000       303,000           1,770,000     1,494,000
Europe                       621,000        484,000             280,000       228,000           1,485,000     1,188,000
Group                      1,332,000      1,145,000             590,000       531,000           3,255,000     2,682,000
Of which SIM-free            154,000        109,000              86,000        68,000             352,000       109,000
                             
Subscription mix
Ex SIM-free                    45.0%          47.8%               38.5%         38.6%               48.5%         52.2%
Inc SIM-free                   39.8%          43.2%               32.9%         33.6%               43.3%         50.0%

Store numbers
UK                               477            466
Europe                           659            672
Group                          1,136          1,138

  • Like for like data

                                     13 weeks to 28 December 2002                            4 weeks to 28 December 2002

                                      Revenue        Gross Profit                            Revenue        Gross Profit

UK                                      +3.4%               +6.6%                              +6.2%               +4.0%
Europe                                 +17.2%               +7.3%                             +24.7%              +14.0%
Group                                   +9.1%               +6.9%                             +14.0%               +7.8%

  • Revenues (£000s)

                                      13 weeks to 28 December 2002                                          Year to date

                                          2002                2001                               2002               2001
Distribution
Retail                                 214,461             182,373                            546,058            462,304
Online                                  12,328               9,974                             32,021             25,539
Insurance                               17,956              16,031                             46,973             42,415
Wholesale                              248,182              79,825                            675,632            255,264
                                       492,927             288,203                          1,300,684            785,521

Telecoms Services                       28,819              23,231                             82,308             65,503

Opal                                    28,077                   -                             28,077                  -

Total                                  549,823             311,434                          1,411,609            851,024




                      This information is provided by RNS
            The company news service from the London Stock Exchange