Trading Statement

Carphone Warehouse Group PLC
10 October 2007



Wednesday 10 October 2007


Embargoed until 0700 hours


                        The Carphone Warehouse Group PLC

                         Second Quarter Trading Update

 Excellent operational performance; increasing visibility of future profitable
                                     growth

Carphone Warehouse today announces its second quarter trading update for the 13
weeks to 29 September 2007.


Second quarter highlights


  • Total connections up 19.2% to 2.8m

  • Subscription connections up 9.3% to 1.1m; up 13.1% excluding 
    'off-the-page' performance

  • 89,000 broadband net adds, taking the base to 2.5m

  • 411,000 broadband customers unbundled, taking the on-net base to 1.4m, or
    55% of the base

  • 500 further exchanges unbundled (137 TalkTalk, 363 AOL), taking the total
    number of unbundled exchanges to 2,212


Charles Dunstone, Chief Executive Officer, said:


'After an excellent operational performance, we expect to report headline
pre-tax profits of £53-56m for the first half, and are confident of the full
year outlook.


'In our Distribution business, overall mobile connections growth remains very
good and our market share is growing strongly, with continued strength in the
pre-pay business offsetting the softer UK direct response market.  Our selection
as a distributor of the iPhone in the UK is a major endorsement of our retail
model and customer proposition, and we expect its launch in November to give us
a significant competitive advantage.


'I am very pleased with the progress we have made in our fixed line business,
with visibility of future profitable growth increasing all the time.  We now
have over one million TalkTalk broadband customers, while the focus in AOL has
been on customer migrations and network roll-out.  As a result, over 80% of all
new broadband customers are now connected directly to our own network.  We are
well ahead of schedule for migrating existing customers to our own network; we
have the most extensive unbundled coverage in the UK; and customer service unit
costs are falling as our processes improve.'


Distribution

Total connections were up 19.2% to 2.8m year-on-year in the 13 weeks to 29
September 2007.  Subscription connections were up 9.3% to 1.1m, with a continued
good performance by the store portfolio offset by persistent weakness in the
direct response market in the UK.  Subscriptions connections growth excluding
this channel was 13.1%, and we continue to grow our market share.  Pre-pay
connections were up 26.8% to 1.6m, reflecting ongoing strength in the pre-pay
segment.


We opened 60 net new stores in the period, taking the base to 2,337.  The
Insurance customer base was up 14.1% year-on-year to 2.4m.


UK Fixed Line

During the period, we added 89,000 customers to our broadband base, taking our
total customer base to 2.5m.  In September we launched our partnership with
Dell, offering free laptops with an AOL broadband subscription.  The positive
impact on AOL sales, combined with a slight improvement in the runrate of
TalkTalk sales, translated into a stronger performance in the last month of the
quarter.  We expect to add 200,000-250,000 broadband customers over the second
half of the year.


We made excellent progress with our network roll-out over the quarter.  We
unbundled a further 137 TalkTalk exchanges and a further 363 AOL exchanges,
taking the totals to 1,384 and 828 respectively.  We also connected an
additional 411,000 customers to our own network, taking our total of on-net
customers to 1.4m, or 55% of our broadband base.  Our business now accounts for
43% of all unbundled lines in the UK market.  With underlying network economics
absolutely in line with our original projections, this gives us increasingly
good visibility of future profitable growth.


Our total voice customer base of 2.7m, combining voice only customers with those
who take bundled voice and broadband, returned to growth in the quarter,
reflecting the success of selling voice services into the AOL broadband base.


Conference call

There will be a conference call for investors and analysts at 9.00am this
morning.  The number for participants is [phone].  In addition, the
freephone number for US callers is 1 866 432 7175.  A replay will be available
for one week on [phone] (freephone from US 1 866 583 1035), and the
access code is 897311.


Next trading update

The group will publish its interim results on 8 November 2007.  The interim
results presentation will be slightly earlier than usual, at 8.30am, to allow
for other companies' results presentations during the morning.


For Further Information


For analyst and institutional enquiries

Roger Taylor                                     07715 170 090

Peregrine Riviere                                07909 907 193



For media enquiries

Shane Conway                                     07932 199 659

Anthony Carlisle (Citigate Dewe Rogerson)        07973 611 888
                                                 020 7638 9571


Operating Statistics


•         Connections and store numbers
                                              13 weeks to 29 September 2007

                                                2007                2006        % change
Connections (000s)

Subscription                                   1,054                 964            9.3%
Pre-pay                                        1,630               1,285           26.8%
SIM-free                                         154                 132           16.4%
Group                                          2,839               2,381           19.2%


                                              26 weeks to 29 September 2007

                                                2007                2006        % change
Connections (000s)

Subscription                                   2,038               1,820           12.0%
Pre-pay                                        2,861               2,279           25.5%
SIM-free                                         288                 241           19.6%
Group                                          5,187               4,340           19.5%

Own stores                                     2,141               1,754           22.1%
Franchises                                       196                 167           17.4%
Total stores                                   2,337               1,921           21.7%


•         Customer bases and exchanges

                                                              As at 29 September 2007

(000s)                                                        2007                   2006

Insurance                                                    2,352                  2,061

TPHT base                                                    1,632                  1,300
UK MVNO base                                                   519                    429

Broadband base                                               2,486                    528
Of which unbundled                                           1,377                     20

Other billed customer base                                   2,051                  2,141

TalkTalk exchanges                                           1,384                    370
AOL exchanges                                                  828                      -

Total exchanges                                              2,212                    370


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