Trading Statement

Carphone Warehouse Group PLC
06 October 2004



Wednesday 6th October 2004

Embargoed until 0700 hours


The Carphone Warehouse Group PLC


Second Quarter Trading Update

The Carphone Warehouse announces its second quarter trading update.  Figures
relate to the 13 weeks to 25 September 2004.

Second quarter highlights

  • Connections up 25.0% to 1.55m
  • Subscription connections up 18.3% to 0.69m
  • 50 new stores opened, taking the total to 1,329
  • 648,000 UK TalkTalk customers; profitable after all costs in August and
    September
  • TalkTalk launches in Spain and Germany
  • Opal traffic up 76.6% to 2.21bn switched minutes


Charles Dunstone, Chief Executive Officer, said:

'All of our core businesses continue to perform well and trading over the first
half has been ahead of our expectations.  The mobile market remains buoyant and
we have achieved further good growth in both subscription and pre-pay
connections.  TalkTalk continues to dominate the UK CPS market, leveraging the
competitive advantages of the Opal network and our high street presence.
Overall, we expect interim pre-tax profits to be at least £27m, after
significant investment in TalkTalk marketing costs.'


Distribution

Total connections grew by 25.0% to 1.55m year-on-year in the 13 weeks to 25
September 2004, as demand continued to be robust across all segments.
Subscription connections grew by 18.3% to 0.69m and pre-pay connections grew by
29.8% to 0.71m.  SIM-free sales also returned to strong growth in the quarter,
rising by 36.8% to 0.14m.  Average gross profit for subscription and pre-pay
connections showed similar year-on-year trends to the first quarter.

Our store opening programme made further good progress, with a total of 50 new
stores opened in the period, taking the total to 1,329, an increase of 154 over
September 2003.

Our Insurance base continued to benefit from strong subscription growth, with
the base growing by 26.8% to 1.46m year-on-year.


Telecoms Services

Total traffic on the Opal network increased by 76.6% year-on-year to 2.21
billion switched minutes.  Excluding TalkTalk traffic, the increase was 18.7%,
with the improving trend in mix being continued from the first quarter.

The TalkTalk customer base continued to grow strongly, with a further 137,000
new customers added in the second quarter, taking the UK base at the end of
September to 648,000.  ARPU, margins and recruitment costs continue to develop
in line with expectations.  Given the weighting of marketing costs towards the
first half, we expect losses in TalkTalk of approximately £6m at the interim
stage.  However, TalkTalk has traded profitably net of all costs in both August
and September.

Outside the UK, our fixed line operations are making steady progress.  We
launched TalkTalk in Spain in September, and in Germany on 1 October.  As a
result, we are now offering residential fixed line services in all of our major
markets, with a total customer base outside the UK of 70,000.

In Mobile, The Phone House Telecom, our German service provider, has continued
the promising trends of the first quarter.  We added a further 39,000 new
customers to the service provision base over the quarter, taking the total to
747,000, representing year-on-year growth of 15.2%.  Overall our Mobile customer
base, including Fresh and our FM operations, increased by 11.3% to 2.08m.


Conference call and audio webcast

There will be a conference call for investors and analysts at 8.30 am this
morning.  The dial-in numbers are 0845 301 4094 from the UK and [phone]
from overseas.  A replay will be available for one week on [phone],
participant number 546412.  The call will also be accessible via our website,
www.cpwplc.com.


Next trading update

The group will publish its interim results on 3 November 2004.



For Further Information

For analyst and institutional enquiries

Roger Taylor                                  07715 170 090
Peregrine Riviere                             07909 907193


For media enquiries
Vanessa Tipple                                07947 000 021
Anthony Carlisle (Citigate Dewe Rogerson)     07973 611 888
                                              020 7638 9571



Operating Statistics


•  Connections, mix and store numbers

                                            13 weeks to 25 September 2004

                                        2004                2003        % change
Connections
Subscription                         687,875             581,481           18.3%
Pre-pay                              714,804             550,583           29.8%
SIM-free                             142,660             104,251           36.8%
Group                              1,545,339           1,236,315           25.0%


                                            26 weeks to 25 September 2004

                                        2004                2003        % change
Connections
Subscription                       1,289,472           1,060,357           21.6%
Pre-pay                            1,232,719             963,624           27.9%
SIM-free                             243,460             213,552           14.0%
Group                              2,765,651           2,237,533           23.6%

Store numbers - period end             1,329               1,175           13.1%
Store numbers - weighted average       1,276               1,153           10.7%




•  Customer bases
                                                  As at 25 September 2004

(000s)                                       2004            2003       % change
Insurance                                   1,458           1,150          26.8%
Telecoms Services - Mobile                  2,079           1,867          11.3%
TalkTalk                                      648             140              -





•  Switched minutes
                                            13 weeks to 25 September 2004

(m)                                     2004                2003        % change
Opal                                   1,307               1,101           18.7%
TalkTalk                                 904                 151               -
Total                                  2,211               1,252           76.6%




                                            26 weeks to 25 September 2004

(m)                                     2004                2003        % change
Opal                                   2,527               2,079           21.5%
TalkTalk                               1,611                 216               -
Total                                  4,138               2,295           80.3%




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