Carphone Warehouse ushers in new CEO after shakeup from Best Buy deal

Carphone Warehouse said Andrew Harrison will take on the role of CEO starting next month, as a shakeup at Europe's largest independent mobile phone retailer will also see its founder and chairman Charles Dunstone resume a more hands-on role, the Guardian reported.


"We've got Charles more on the pitch on the back of the acquisition," current CEO Roger Taylor told the newspaper. "Clearly he was a bit more removed from the business in the days of the joint venture."

For his part, Taylor will become deputy chairman of the company at the company's annual general meeting on July 24. Harrison has been CEO of of Carphone Warehouse Europe.

The news about the change in management came as Carphone said it has completed the acquisition of a 50 per cent stake in New BBED Limited ("CPW Europe") that the company does not already own from Best Buy for a net consideration of £471 million ($721 million). New BBED is the parent company of the joint venture between Carphone Warehouse and Best Buy. The stake was originally sold to Best Buy in 2008 for £1.1 billion.

"The completion of our acquisition of Best Buy's 50 per share of CPW Europe means that once again Carphone Warehouse's retail operation forms the core of the group's business,"  Taylor said in a statement. "It is logical, therefore, that Andrew Harrison, who has run this business for several years, should step up to become chief executive officer for the group."

The Guardian noted that Carphone's attempt to import the Best Buy format to the UK ended in failure. The 11 big box electronics stores never turned a profit and were closed in 2011.

Once Best Buy's share of the retail operations is handed back, Carphone expects underlying earnings to rise from £137 million in the last fiscal year to between £140 million and £160 million in the financial year to March 2014. The company is hoping to profit from upcoming LTE service launches across Europe in the coming 12 months, although it expects general conditions to remain difficult.

"We expect the consumer environment in Europe to remain challenging in the year ahead," said Taylor. "Against this, the more widespread development and promotion of 4G services may provide a stimulus to the handset replacement cycle and an opportunity for network operators to develop pricing structures to reflect higher quality services and higher levels of data consumption."

In its preliminary results to the end of March 2013, Carphone said revenue generated by CPW Europe increased by 11.5 per cent to £3.69 billion. The company's Virgin Mobile France venture also recorded revenue growth of 4.2 per cent at constant currency, while the number of postpaid customers increased by 11,000.

Reuters said the company also met guidance for the year's earnings; headline earnings per share were 12.3 pence in the year to March 31, in line with company guidance of 11.5 pence to 13.0 pence but down from 12.6 pence in the 2011-12 financial year.

For more:
- see this Guardian article
- see this Reuters article
- see Carphone Warehouse results

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