14 November 2013 Embargoed until 7am

Carphone Warehouse Group plc

Interim results for the 26 weeks ended 28 September 2013

Continued good LFL revenue performance; strong platform for growth;

reiterating full year guidance

Completion of acquisition of CPW Europe

CPW H1 like-for-like revenue growth of 8.3% (H1 2012-13: 1.6%)

Encouraging early signs for 4G

Virgin Mobile France resumes postpay growth in Q2

Premium listing achieved, FTSE index review in December

CPW (100% owned from 26 June 2013)

H1 like-for-like revenue up 8.3% (Q2 like-for-like up 3.6%)

Pro forma Headline EBIT of £21m (2012: £6m), reflecting reduced costs (despite opex investment in retail proposition) and fair value adjustments

Good progress on European partnerships and Connected World Services

Full year expectations in line with guidance (pro forma Headline EBIT range of £140m - £160m)

Virgin Mobile France (46% joint venture)

Q2 postpay net adds marginally positive (Q1: negative 15,000); postpay base of 1.33m customers

As expected Q2 revenue decline, by 12.6% (Q1: decline of 15.1%) at a constant currency

H1 EBIT £3m (2012: £8m) reflecting prior year re-pricing, H2 to benefit from Full MVNO

Group results

Group Headline PBT of £19m (2012: £4m)

Group statutory PBT loss of £25m (2012: profit of £8m) after exceptional French costs of £31m and net acquisition-related costs of £13m

Group Headline EPS 2.6p (2012: 0.6p)

Interim dividend of 2.00p (2012: 1.75p) payable in December 2013

Reiterating full year guidance (Headline EPS range 17.0p – 20.0p) Pro forma results are defined in the Performance Review and a reconciliation of Headline results to statutory results is provided in note 6 to the condensed financial statements.

Andrew Harrison, CEO, said: “Carphone Warehouse has delivered good like-for-like growth for the half and for the fifth successive quarter. This is a strong performance given the reduced marketplace activity ahead of the wider launch of 4G across Europe and the continued double-digit decline of the prepay market. We have increased market share and grown EBIT year-on-year. “We invested in our brand and our channels during the period to reposition Carphone Warehouse and make our role within mobile retailing clearer than ever. This investment includes a new tablet-based

sales tool called ‘Pin Point’ which simplifies our sales process, particularly relevant with the widespread arrival of 4G. “We continue to develop our partnerships with other retailers as we look to gain scale in Europe. We have set up and launched our new Connected World Services division, forging promising new global relationships, and creating our new ‘honeyBee’ platform with Accenture. “Looking ahead, we reiterate our full year guidance. We are in excellent operational shape to take advantage of the key Christmas trading period and are encouraged by the growth of 4G as it starts to arrive across all the major networks.” CPW Pro forma Headline EBIT increased from £6m to £21m as a result of reduced operating costs and reduced depreciation and amortisation charges. Like-for-like revenues were up 8.3% with postpay connections growth in the first half. In the postpay category we gained further market share and saw encouraging signs for the uptake of 4G. The prepay market remains weak; however, we outperformed the UK market and continued to gain market share. Overall connections were flat in the first half. As expected, Q2 like-for-like sales growth at 3.6% was slower than Q1 (13.2%), primarily reflecting tougher comparatives. We also saw a period of market transition in advance of the 4G roll-out, with consumers delaying purchases and networks understandably putting less emphasis on investing in upgrades and new subscriptions whilst preparing for 4G and all the potential it has to offer. We are encouraged by the interest and uptake of 4G and expect the benefits to come through progressively. We believe our business is ideally placed to sell 4G connections, as we explain the opportunities and simplify the complexities for our customers through our service led proposition including Pin Point and Geek Squad. We have a highly trained and motivated set of employees who have the right tools to take advantage of this exciting opportunity. Across mainland Europe CPW continues to drive growth across a number of its markets, with particularly encouraging performance in Spain, and continued progress towards profitability in Germany. In mainland Europe as in the UK, we are excited by the opportunities that 4G presents for our business. As for most retailers, Christmas remains the crucial trading period, and we believe that we are well placed to enjoy a Christmas period of connected product sales including tablets, and our first half results provide a strong platform for further growth in the second half and beyond. European Partnerships We are making good progress with our European partnerships to gain scale and grow value within our existing markets. In the Netherlands we currently trade within 17 Makro stores and 3 Media-Markt Saturn (MSH) stores. Without wishing to disrupt the all-important Christmas period we plan to roll out the majority of our store-within-a-store formats with MSH by the end of September 2014. In Germany we are progressing our relationship with the Metro Group and have been working with them on a more tailored B2B offer. In Ireland, we have made good progress on the roll-out of stores in Harvey Norman during the period and now have a total of 11 Harvey Norman stores-within-a-store. Discussions continue with MSH and with other partners across other territories and we believe that, in time, our partnerships will offer a mutually beneficial way of expanding the sales of connected products.

Connected World Services Connected World Services is our new B2B business, which aims to leverage our expertise and systems to provide services to other businesses operating in the connected world, in multiple geographies. It covers services based on retail and commercial consultancy, insurance and technology support, buying alliances and an omni-channel retail platform (called honeyBee) which offers an end-to-end solution for connected retailing. We deliver these services with support from key partners, such as Accenture (our partner to design, build and market the honeyBee platform). Connected World Services already works with a number of businesses, including RBS, TalkTalk, British Gas and Belgacom. We expect this list to grow and there is an exciting pipeline of opportunities. Over time, Connected World Services can provide Carphone Warehouse with an opportunity to develop its global reach and deliver a meaningful profit stream with relatively low levels of incremental capex and marketing. Update on France We have made good progress on our exit from the French retail market. Over half of our own store leases had been assigned to third parties by the end of September, and we expect to have substantially completed the assignment of remaining leases by March 2014. We have made every effort to minimise redundancies and expect that more than half our people will transfer to new employers as leases are assigned. We maintain our previous guidance of total cash exit costs in the region of £30m. Virgin Mobile France Virgin Mobile France resumed postpay growth in Q2. The year-on-year impact of re-pricing has reduced the rate of revenue decline from 15.1% in Q1 to 12.6% in Q2. The business has made encouraging progress in respect of the continued migration of customers onto the full MVNO platform. At September there were more than 1.1m customers on this platform, representing 66% of the base. During the period, Virgin Mobile France concluded its third network supply agreement, with Bouygues Telecom, providing an exciting opportunity to offer 4G propositions later in the financial year. Board changes The company has today separately announced the proposed appointment of Gerry Murphy as an independent non-executive director, with effect from 2 April 2014. Gerry is a former Deloitte LLP partner and was leader of its Professional Practices Group with direct industry experience in consumer business, retail and TMT. He was a member of the Deloitte board and chairman of its audit committee for a number of years and also chairman of the Audit & Assurance Faculty of the Institute of Chartered Accountants in England & Wales. As part of the company's transfer to the premium segment of the official list it intends to announce during the current financial year the appointment of at least one other new independent non-executive director. Outlook We are encouraged by the first half performance of our retail business, and reiterate our full year guidance for CPW Headline EBIT and cash flow, and Group Headline EPS. We are conscious of the challenging consumer and regulatory environment across Europe and the competitive dynamics we face from time to time. The opportunities presented by 4G, however, are exciting for Carphone Warehouse, providing an impetus for increased customer usage and for new devices. We are confident that the investment we have made in the first half in improving our selling processes will help us to take advantage of these opportunities. 4G services are available to a limited proportion of our customers, but we are encouraged by levels of customer take-up to date, and anticipate that momentum will build over time as customers become aware of the quality of services available to them.

We remain committed to our partnership strategy in Europe, and anticipate continued progress through the second half. We also remain confident in our Connected World Services opportunities, and continue to invest resources to drive this business forward. In Virgin Mobile France, our priority will remain to progress our Full MVNO migration, at the same time as taking advantage of new opportunities in the market to drive the value of our business. Analysts’ presentation and webcast There will be a presentation for investors and analysts at 9.00 am this morning at the offices of Deutsche Bank AG, Winchester House, 1 Great Winchester Street, London, EC2N 2DB. The event will be audio webcast and the presentation slides will be available on our website, www.cpwplc.com. Dial-in details – UK/International: +44 (0)203 427 1901, USA: +1 646 254 3361, passcode 3372969 Seven-day replay – UK/International: +44 (0)203 427 0598, USA: +1 347 366 9565, passcode 3372969# Next announcement The Group will provide an interim management statement for the third quarter of the current financial year on Tuesday 21 January 2014. For analyst and institutional enquiries Kate Ferry, IR Director +44 (0) 7748 933 206 Kerry Becker, IR Manager +44 (0) 7748 910 861 For media enquiries Anthony Carlisle (Citigate Dewe Rogerson) +44 (0) 7973 611 888 / +44 (0) 20 7638 9571 Elizabeth Holloway, Head of PR, CPW Group +44 (0) 7443 581 015 / +44 (0) 20 8617 2019

Performance Review This performance review covers: CPW: the Group’s wholly-owned businesses including, since 26 June 2013, CPW Europe which prior to this date had been a 50% joint venture. CPW results are shown on a pro forma basis, as though CPW Europe had been 100% owned by the Group throughout the current and prior periods, to enable year-on-year comparison. Further to our decision to exit the French retail market, the results of our business there are excluded from Headline earnings in both periods. Accordingly, CPW KPIs are stated excluding France. Virgin Mobile France: the Group’s 46% interest in a joint venture with Virgin Group. Group Results: covering the Headline and statutory performance of the Group as a whole, reflecting the CPW Europe Acquisition as it is reported in the Group’s income statement and other financials. CPW Headline income statement (pro forma basis) *

2013 £m

Restated *

2012 £m

Revenue 1,566 1,480 Gross margin 369 372 GM % 23.6% 25.1% Operating expenses (320) (328) EBITDA 49 44 Depreciation and amortisation (28) (38) EBIT 21 6 EBIT% 1.4% 0.4% Interest (7) (4) PBT 14 2 Tax (3) (1) PAT 11 1 * Prior year Headline results have been restated to exclude the results of the Group’s French business following the decision to pursue an orderly exit from this market. This business generated revenues of £185m and EBIT of £9m in the prior period. For further details see notes 3 and 6 to the condensed financial statements. Pro forma Headline EBITDA includes the unwinding of discounts for the time value of money on network commissions receivable over the life of the customer. This unwind had a value of £4m in the period (2012: £4m) and is treated as interest income in the Group’s non-pro forma Headline and statutory results.

CPW generated revenues of £1,566m, an increase of 5.8% year-on-year (2012: £1,480m). Like-for-like revenue growth was 8.3% in the first half, principally reflecting strong growth in postpay volumes in the UK, where we continued to see significant market share gains. Our performance in the first quarter was particularly strong, with like-for-like revenue growth of 13.2%. In the second quarter we annualised against a tougher comparative period, including the successful ‘Smart Deal’ promotions launched last year. Alongside this, the second quarter was affected by reduced activity in the market in advance of the launch of 4G services by a number of network operators and new product launches towards the end of the quarter. Despite these factors, like-for-like revenue growth in the second quarter was 3.6%. With the network operators increasingly focused on 4G, the prepay market has declined further during the period, and we estimate that the UK market in the first half was down by 20-30% year-on-year. Against this backdrop we gained share in this category and will continue to seek opportunities and to drive smartphone penetration in this segment. Within total revenue, the like-for-like growth described above was partially offset by a reduction in revenues from our dealer business, reflecting weakness in the wholesale market. As previously noted,

the dealer business operates at very low margins, and the reduced revenue therefore has a limited impact on earnings. Overall revenue was also affected by the strengthening of the Euro year-on-year, although this was partially offset by the absence of revenue from our Swiss fixed line business which we sold towards the start of the year. With continued weakness in the prepay segment offsetting postpay growth, connection volumes in the first half were broadly flat at 4.1m (2012: 4.1m). CPW opened or re-sited 46 stores and closed 62, ending the period at 2,044 stores, down from 2,060 at the beginning of the year (all excluding France). Within this portfolio, the number of franchise stores increased from 268 at March 2013 to 280 at the end of the period, primarily reflecting growth in Spain. The decrease in own stores predominantly reflects the closure of stores in Germany. Gross margin was broadly flat year-on-year at £369m (2012: £372m). Average postpay margins were slightly down year-on-year, reflecting the mix effect of increased low-end postpay volumes in the first quarter, together with some margin investment in the overall proposition in advance of more widespread roll-out of 4G. For the full year we continue to expect to maintain year-on-year average cash gross margins in our core product categories. CPW’s gross margin percentage decreased year-on-year by 150 basis points to 23.6% (2012: 25.1%). Reduced low margin dealer revenues partially offset a reduction in the gross margin percentage on the core business, which largely reflects the expected effects of changes in the sales mix, together with the margin investment noted above. Continuing the pattern seen from the second quarter of last year, we saw a higher weighting to high-end postpay handsets, and an increasing impact from non-cellular sales such as tablets, both of which have a lower gross margin percentage than other categories. We expect to see a more comparable sales mix in the second half of the year, and therefore less significant year-on-year movement in the gross margin percentage in that period. Operating expenses decreased by 2.3% year-on-year to £320m (2012: £328m). This reduction principally reflects cost savings arising from the reorganisation programme undertaken in the second half of last year, together with a net reduction in operating expenses arising from the acquisition accounting exercise. These benefits were partially offset by additional investment in Connected World Services and investment in our retail sales processes. Depreciation and amortisation decreased to £28m (2012: £38m), in part reflecting the effect of outsourcing contracts, through which responsibility for capital investment has transferred to third parties, as noted last year. Depreciation and amortisation have also been affected, in line with expectations, by the acquisition accounting exercise, with depreciation and amortisation decreasing following the revaluation of CPW Europe’s non-current assets to fair value. As a result of reduced operating costs and reduced depreciation and amortisation charges, CPW’s pro forma Headline EBIT increased from £6m to £21m. The interest charge for the period was £7m (2012: £4m) reflecting additional borrowings following the CPW Europe Acquisition. CPW had an effective tax rate of 22% (2012: 55%). We expect the full year effective rate to be broadly in line with the guidance given at the start of the year of c.23%. Further to previous announcements, we have made good progress on our exit from the French retail market. Over half of our own store leases had been assigned to third parties by the end of September, and we expect to have substantially completed the assignment of remaining leases by March 2014. Alongside this, we have also terminated the majority of our franchise contracts. We have made every effort to minimise redundancies and expect that more than half our people will transfer to new employers as leases are assigned. Given the complexity of the exit programme, uncertainties remain on the ultimate cost of this process, but we maintain our previous guidance of cash exit costs in the region of £30m.

Operating cash flow (pro forma basis)

* Headline EBITDA is expressed on a pro forma basis for consistency with earnings analysis. In the current year, working capital and capex include CPW Europe movements both before and after the CPW Europe Acquisition.

Headline EBITDA increased year-on-year to £49m (2012: £44m) for the reasons described above. The business saw the usual seasonal working capital outflow in the first half. The absorption of working capital was £165m in the period, compared to £91m in the previous year, largely reflecting high levels of stock associated with new product launches at the end of the period, together with a higher weighting of purchases during the period from suppliers with less favourable payment terms. We expect to address these terms in the second half of the year, and maintain our guidance of a full-year working capital outflow in the region of £50m. Capex spend reduced to £22m (2012: £37m). The business opened fewer stores year-on-year and the IT investment being undertaken to support the continued development of both the retail and Connected World Services propositions is largely weighted towards the second half of the year. Virgin Mobile France Headline income statement (100% basis) * 2013

£m 2012

£m Revenue 176 192 EBITDA 8 11 Depreciation and amortisation (5) (3) EBIT 3 8 EBIT % 1.9% 4.2% Interest (1) (1) Taxation (1) (2) PAT 1 5 Group share 1 2 * See note 8 to the condensed financial statements.

Virgin Mobile France revenue decreased by 8.3% year-on-year on an actual currency basis to £176m (2012: £192m) with a reduction of 13.9% on a constant currency basis, offset by a strengthening of the Euro year-on-year. This revenue decline was broadly in line with expectations, reflecting market re-pricing during the prior year and a reduction in the average customer base over the same period, in a highly competitive French marketplace. The business resumed growth in its postpay customer base in the second quarter, albeit at modest levels, reversing the trend of the previous three quarters. For the half as a whole, the postpay base fell by 15,000 to 1.33m (2012: 1.42m). Virgin Mobile France concluded its third network supply agreement, with Bouygues Telecom, in September 2013, providing an exciting opportunity to offer 4G propositions later in the financial year, and extending the customer reach of the business. The total customer base declined by 18,000 during the first half to 1.70m (2012: 1.88m) reflecting the postpay reduction noted above along with a marginal decline in the prepay base.

2013 £m

2012 £m

Headline EBITDA * 49 44 Working capital (165) (91) Capex (22) (37) Operating free cash flow (138) (84)

The business has continued to migrate customers onto its Full MVNO infrastructure, which enables it to participate more fully in customer revenue streams and to reduce its costs, as well as providing greater strategic flexibility. At the end of September over 1.1m customers were on this platform, representing 66% of the customer base. The business produced a Headline EBIT of £3m (2012: £8m) reflecting the re-pricing noted above, together with higher levels of depreciation and amortisation as a result of investment in the Full MVNO infrastructure. We expect the benefits of the Full MVNO to improve earnings in the second half. The tax charge decreased to £1m (2012: £2m) reflecting the lower level of earnings described above. Cash flow (100% basis) 2013

£m 2012

£m EBITDA 8 11 Working capital (10) 9 Capex (4) (12) Operating free cash flow (6) 8 Other (1) (2) Movement in net debt (7) 6 Opening net debt (40) (40) Closing net debt * (47) (34) * Comprises shareholder loans of £38m (2012: £44m), finance leases of £11m (2012: nil) and net cash of £2m (2012: £10m).

EBITDA decreased from £11m to £8m for the reasons described above. Capex reduced year-on-year to £4m (2012: £12m) with the prior period spend including investment in the Full MVNO deferred from previous year. As anticipated, after substantial working capital inflows over the previous five years the business recorded a working capital outflow of £10m (2012: inflow of £9m) in the first half of the year, largely reflecting timing differences, together with an improved allocation of handsets launched towards the end of the period. Other cash flows reflect interest and tax payments and the impact of foreign exchange. Group Results Headline income statement

2013 £m

Restated

2012 £m

EBIT Wholly-owned operations 22 2 Joint ventures (1) 1 Interest (2) 1 PBT 19 4 Tax (5) (1) PAT 14 3 EPS (basic) 2.6p 0.6p EBIT for wholly-owned operations includes CPW Europe from 26 June 2013. In the period prior to this CPW Europe registered a post-tax loss, of which the Group’s share was £2m, which is included in results from joint ventures. The acquisition balance sheet remains open until the Group’s full year results are finalised, and may therefore be affected by changes in estimates arising from new information obtained in the second half of

the year. On this basis, both the acquisition balance sheet and CPW Europe’s results to 26 June 2013 are at this stage provisional. Improved pro forma Headline EBIT in CPW, together with the benefit of bearing only 50% of pre-acquisition losses, resulted in an increase in Group EBIT from £3m to £21m. This in turn resulted in an increase in EPS from 0.6p to 2.6p for the period. Non-Headline items

2013 £m

Restated

2012 £m

Headline PAT 14 3 France (in process of closure) (post-tax) (30) 4 CPW Europe Acquisition (post-tax) (7) - Amortisation of acquisition intangibles (post-tax) (4) - Statutory PAT (27) 7 EPS (basic) (5.0)p 1.5p Non-Headline items in the income statement comprise losses associated with our French business during our exit from that market together with the results of that business for comparative periods, items associated with the CPW Europe Acquisition, and the amortisation of acquisition intangibles. Non-Headline results of France include the Group’s post-tax share of operating losses of the French business, asset write-downs and provisions for closure costs, totalling £25m. CPW results include a further £5m of post-tax losses for the period since acquisition. The Group’s post-tax share of the profit of its French business in the prior period was £4m. CPW results include net costs of £8m in relation to the CPW Europe Acquisition, against which a tax credit of £1m has been recognised. These costs represent banking and professional fees on the transaction and cash and non-cash charges associated with employee incentive schemes, offset by gains on the revaluation of CPW Europe and on the disposal of the consideration shares issued to Best Buy in relation to the CPW Europe Acquisition. CPW results also include an amortisation charge of £5m, against which a tax credit of £1m has been recognised, on acquisition intangibles arising on the CPW Europe Acquisition. For further details of non-Headline items see note 3 to the condensed financial statements.

Movements on net funds (debt) (pro forma) *

* This pro forma summary aggregates the net funds (debt) of the Group and CPW Europe, as though CPW Europe had been 100% owned by the Group throughout the current and prior periods, to enable a complete understanding of cash flows.

Operating free cash outflow was £138m (2012: £84m) for the reasons described in the CPW section above. Cash outflows relating to the CPW Europe Acquisition were £360m, comprising net upfront cash consideration of £341m, cash costs of incentive schemes of £8m, and banking and professional fees of £11m. Net proceeds on shares comprise £103m raised through the placing in April 2013 of 47m shares at a price of £2.22 per share and £23m received in July 2013 on the disposal of the consideration shares issued to Best Buy in respect of the CPW Europe Acquisition. Distributions to shareholders of £19m (2012: £48m) represent ordinary dividends, together with £33m in the prior period returned to shareholders through the deferred capital option of the B/C Share Scheme following the disposal of Best Buy Mobile in January 2012. Other cash flows include cash outflows of £39m on our French business, principally comprising operating losses and cash costs of closure. Some of these cash costs will be offset in future periods as we realise the value of the assets of the business, and we expect the ultimate net cash cost of closure to be in the region of £30m. Cash outflows in relation to France also include movements on working capital, the ongoing profile of which will depend on the exit process. Other cash flows also include the proceeds on disposal of CPW Europe’s fixed line operations in Switzerland and the disposal of the Group’s second freehold in Acton, both of which completed in April, offset by tax and interest payments and the purchase of the Group’s own shares. Other cash flows in the prior period reflect exceptional cash costs associated with Best Buy UK, offset by EBITDA from the French business, which is excluded from pro forma Headline earnings, and other cash flows reported by the wholly-owned Group in that period. Balance sheet As a result of the CPW Europe Acquisition, the Group has derecognised its interest in the CPW Europe joint venture and consolidated the CPW Europe balance sheet in full with effect from 26 June 2013. CPW Europe’s assets and liabilities have been consolidated at fair value, resulting in certain differences to their book value at acquisition. These differences relate principally to property, plant and equipment, operating intangible assets and property leases. Property, plant and equipment and operating intangible assets were valued by third party experts using a replacement market cost methodology. Leases were also valued by third party experts, comparing actual rents to market rents at acquisition, resulting in the recognition of a liability for leases that are deemed to be over-rented. At the same time, deferred rent-free incentives and key money assets have been derecognised. Acquisition intangibles with a value of £65m, in relation to customer bases and brands, were also recognised as part of the acquisition.

2013 £m

2012 £m

Operating free cash flow (138) (84) CPW Europe Acquisition (360) - Net proceeds on shares 126 - Distributions to shareholders (19) (48) Other (41) (2) Movement in net funds (debt) (432) (134) Opening net funds 238 73 Closing net debt (194) (61)

Provisional goodwill of £497m has arisen on the acquisition, reflecting the fact that CPW Europe’s value is based on its cash generating potential rather than its existing assets, and the fact that many of its key strengths, such as its scale and expertise, do not represent intangible assets as defined by IFRS. Dividends The Board has declared an interim dividend of 2.00p per share, up from 1.75p per share last year. The ex-dividend date is Wednesday 20 November 2013, with a record date of Friday 22 November 2013 and an intended payment date of Friday 13 December 2013.

CONDENSED FINANCIAL STATEMENTS Condensed consolidated income statement (26 weeks ended 28 September 2013 and 6 months ended 30 September 2012)

26 weeks ended 28 September 2013 6 months ended 30 September 2012

(Unaudited) (Unaudited)

Restated* Restated*

Headline Non-Headline* Statutory Headline Non-Headline* Statutory

Notes £m £m £m £m £m £m

Revenue 2,3 822 40 862 5 - 5

Cost of sales 3 (623) (30) (653) - - -

Gross profit 199 10 209 5 - 5

Operating expenses 3 (177) (29) (206) (3) - (3) Share of results of joint ventures 2,3,8 (1) (25) (26) 1 4 5

Profit (loss) before interest and taxation 21 (44) (23) 3 4 7

Interest income 3 - 3 1 - 1

Interest expense (5) - (5) - - -

Profit (loss) before taxation 19 (44) (25) 4 4 8

Taxation 3 (5) 3 (2) (1) - (1)

Net profit (loss) for the period 14 (41) (27) 3 4 7

Earnings per share

Basic 7 2.6p (5.0)p 0.6p 1.5p

Diluted 7 2.6p (5.0)p 0.6p 1.5p

* Non-Headline items comprise exceptional items, amortisation of acquisition intangibles and the results of the Group’s operations in France, which are in the process of closure (see note 3). Prior period comparatives have been restated to classify the results of the French business as non-Headline. A reconciliation of Headline results to statutory results is provided in note 6.

Condensed consolidated income statement (26 weeks ended 28 September 2013 and year ended 31 March 2013)

26 weeks ended 28 September 2013 Year ended 31 March 2013

(Unaudited) (Audited)

Restated* Restated*

Headline Non-Headline* Statutory Headline Non-Headline* Statutory

Notes £m £m £m £m £m £m

Revenue 2,3 822 40 862 11 - 11

Cost of sales 3 (623) (30) (653) - - -

Gross profit 199 10 209 11 - 11

Operating expenses 3 (177) (29) (206) (8) - (8) Share of results of joint ventures 2,3,8 (1) (25) (26) 51 (51) -

Profit (loss) before interest and taxation 21 (44) (23) 54 (51) 3

Interest income 3 - 3 2 - 2

Interest expense (5) - (5) - - -

Profit (loss) before taxation 19 (44) (25) 56 (51) 5

Taxation 3 (5) 3 (2) (1) - (1)

Net profit (loss) for the period 14 (41) (27) 55 (51) 4

Earnings per share

Basic 7 2.6p (5.0)p 11.6p 0.9p

Diluted 7 2.6p (5.0)p 11.5p 0.9p

* Non-Headline items comprise exceptional items, amortisation of acquisition intangibles and the results of the Group’s operations in France, which are in the process of closure (see note 3). Prior period comparatives have been restated to classify the results of the French business as non-Headline. A reconciliation of Headline results to statutory results is provided in note 6.

Condensed consolidated statement of comprehensive income

26 weeks ended 28

September 2013

(Unaudited)

6 months ended 30

September 2012

(Unaudited)

Year ended 31 March

2013 (Audited)

£m £m £m

Net (loss) profit for the period (27) 7 4 Items that may be subsequently reclassified to profit and loss:

Currency translation (9) (7) 2

Total recognised income and expenses for the period (36) - 6

Condensed consolidated statement of changes in equity 26 weeks ended 28 September 2013 (Unaudited)

Share

capital

Share premium

reserve Accumulated

profits

Translation reserve

Demerger reserve

Capital redemption

reserve Total £m £m £m £m £m £m £m

At the beginning of the period

1 170 1,238 2 (750) - 661

Total recognised income and expenses for the period

-

-

(27)

(9)

-

-

(36)

Issue of own shares - 113 103 - - - 216 Net purchase of own shares - - (12) - - - (12) Equity dividends - - (19) - - - (19) Net movement in relation to share schemes - - 3 - - - 3

At the end of the period 1 283 1,286 (7) (750) - 813

6 months ended 30 September 2012 (Unaudited)

Share capital

Share premium

reserve Accumulated

profits

Translation reserve

Demerger reserve

Capital redemption

reserve Total £m £m £m £m £m £m £m

At the beginning of the period 34 170 697 - (750) 557 708 Total recognised income and expenses for the period

-

-

7

(7)

-

-

-

Redemption of shares (33) - (33) - - 33 (33) Equity dividends - - (15) - - - (15) Capital reduction - - 590 - - (590) -

At the end of the period 1 170 1,246 (7) (750) - 660

Year ended 31 March 2013 (Audited)

Share capital

Share premium

reserve Accumulated

profits

Translation reserve

Demerger reserve

Capital redemption

reserve Total £m £m £m £m £m £m £m

At the beginning of the year 34 170 697 - (750) 557 708 Total recognised income and expenses for the year

-

-

4

2

-

-

6

Redemption of shares (33) - (33) - - 33 (33) Equity dividends - - (23) - - - (23) Capital reduction - - 590 - - (590) - Share of other reserve movements of joint ventures

-

-

3

-

-

-

3

At the end of the year 1 170 1,238 2 (750) - 661

Condensed consolidated balance sheet

28 September

2013 (Unaudited)

30 September 2012

(Unaudited)

31 March 2013

(Audited) Notes £m £m £m

Non-current assets Goodwill 495 - - Intangible assets 125 - - Property, plant and equipment 80 66 27 Interests in joint ventures 8 12 531 537 Deferred tax assets 53 1 1 Trade and other receivables 130 - -

895 598 565

Current assets Stock 322 - - Trade and other receivables 897 2 3 Cash and cash equivalents 178 81 117

1,397 83 120

Total assets 2,292 681 685

Current liabilities Trade and other payables (847) (11) (17) Deferred consideration (25) - - Corporation tax liabilities (40) (1) - Finance lease obligations (2) - - Provisions (59) (9) (7)

(973) (21) (24)

Non-current liabilities Trade and other payables (111) - - Deferred consideration (25) - - Loans and other borrowings (370) - -

(506) - -

Total liabilities (1,479) (21) (24)

Net assets 813 660 661

Equity Share capital 1 1 1 Share premium reserve 283 170 170 Accumulated profits 1,286 1,246 1,238 Translation reserve (7) (7) 2 Demerger reserve (750) (750) (750)

Funds attributable to equity shareholders 813 660 661

Approved by the Board of Carphone Warehouse Group plc 13 November 2013

Condensed consolidated cash flow statement

26 weeks ended 28 September

2013 (Unaudited)

6 months ended 30 September

2012 (Unaudited)

Year ended 31 March 2013

(Audited) £m £m £m

Operating activities (Loss) profit before interest and taxation (23) 7 3 Adjustments for non-cash items: Share-based payments 3 - - Non-cash movements on joint ventures 18 (5) - Depreciation 6 1 1 Amortisation 11 - -

Impairment - - 1

Profit on disposal of property, plant and equipment - - (3)

Operating cash flows before movements in working capital 15 3 2 Decrease in trade and other receivables 63 19 19 Decrease in stock 23 - -

Increase in trade and other payables 112 - 7 Decrease in provisions (10) - (3)

Cash flows from operating activities 203 22 25 Taxation paid (12) - (1)

Net cash flows from operating activities 191 22 24

Investing activities

Interest received 3 1 2 Net cash outflow arising on CPW Europe Acquisition (317) - - Proceeds from the sale of current investments 5 - - Proceeds from the disposal of property, plant and equipment 11 - 40 Acquisition of property, plant and equipment (4) - - Acquisition of intangible assets (13) - - Net receipts from joint ventures 2 2 4

Cash flows from investing activities (313) 3 46

Financing activities Net drawdown of borrowings 370 - - Repayment of CPW Europe debt on acquisition (271) - - Settlement of financial instruments 2 1 - Net purchase of own shares (12) - - Equity dividends paid (19) (15) (23) Shares redeemed - (33) (33) Interest paid (4) - - Facility arrangement fees paid (6) - - Issue of shares 124 - - Repayment of obligations under finance leases (1) - -

Cash flows from financing activities 183 (47) (56)

Net increase (decrease) in cash and cash equivalents 61 (22) 14 Cash and cash equivalents at the start of the period 117 103 103

Cash and cash equivalents at the end of the period 178 81 117

1 Basis of preparation and accounting policies

General information A copy of the Carphone Warehouse Group plc annual report for the year ended 31 March 2013 (“Annual Report”) can be found on the Group’s website www.cpwplc.com and a copy has been delivered to the Registrar of Companies. The report of the Group’s auditors was unqualified, did not draw attention to any matters by way of emphasis and did not contain a statement under section 498(2) or (3) of the Companies Act 2006. The information included in this document for the year ended 31 March 2013 does not constitute statutory accounts as defined in section 434 of the Companies Act 2006. The financial statements for the 26 weeks ended 28 September 2013 and the 6 months ended 30 September 2012 have not been subject to audit or review by the Group’s auditors. Basis of preparation The financial statements of the Group are prepared in accordance with the measurement and recognition criteria of IFRS. The condensed financial statements included in this half year report have been prepared in accordance with IAS 34 ‘Interim Financial Reporting’. On 26 June 2013 the Group completed the CPW Europe Acquisition for a net consideration of £471m, at which point CPW Europe became a 100% owned subsidiary of the Group. In these financial statements, CPW Europe is treated as a joint venture prior to 26 June 2013 and as a wholly-owned subsidiary from 26 June 2013 onwards. In prior periods, the Group reported to a financial year-end of 31 March and an interim period-end of 30 September. CPW Europe reports to a retail calendar whereby its year-end date is normally the Saturday closest to 31 March. Following the CPW Europe Acquisition the Group will report to the same retail calendar as CPW Europe and has consequently prepared interim financial statements for the 26 weeks ended 28 September 2013. Going concern At 28 September 2013 the Group had net debt of £194m (September 2012: net funds of £81m, March 2013: net funds of £117m). The directors have reviewed the future cash and profit forecasts of the Group, which they consider to be based on prudent assumptions. The directors are of the opinion that the forecasts, which reflect both the current uncertain economic outlook and reasonably possible changes in trading performance, show that the Group should be able to operate within its facilities and comply with its banking covenants. In arriving at their conclusion that the Group has adequate financial resources, the directors were mindful that the Group has a robust policy towards liquidity and cash flow management and that it is financed through committed facilities totalling £650m. These facilities comprise a £400m RCF which matures in April 2017 and a £250m term loan, which contains amortisation provisions of £75m, and which also matures in April 2017. The Group’s operations are financed by these committed facilities and retained profits and equity. Accordingly the directors have a reasonable expectation that the Group has adequate resources to continue in operation for the foreseeable future and consequently the directors continue to adopt the going concern basis in the preparation of the financial statements. Accounting policies In the current period, the Group has adopted the amendments to IAS 1 ‘Presentation of Items of Other Comprehensive Income’ and IFRS 13 ‘Fair Value Measurement’. The amendments to IAS 1 require items of other comprehensive income to be grouped by those items that may be subsequently reclassified to profit or loss and those that will never be reclassified, together with their associated income tax. IFRS 13 has affected the measurement of fair value for certain assets and liabilities as well as introducing new disclosures, as set out in note 9. Otherwise, these interim condensed financial statements have been prepared using accounting policies and methods of computation consistent with those set out on pages 54 to 59 of the Annual Report, along with the definitions that are set out on page 85 of the same document.

2 Segmental reporting

IFRS 8 ‘Operating Segments’ requires that operating segments mirror the segments that are routinely reviewed by the board, and which are used to manage performance and to allocate resources. Following the CPW Europe Acquisition, the Group operates two principal geographical regions, which have their own management teams, being UK and Ireland and Mainland Europe. Virgin Mobile France is managed separately from the rest of the Group and is therefore presented as a separate segment. Segmental results are analysed as follows:

26 weeks ended 28 September 2013 CPW Joint ventures

UK and Ireland

Mainland Europe

CPW Europe (see note 8)

Virgin Mobile France

(see note 8) Total £m £m £m £m £m

Revenue 461 401 - - 862

Headline EBIT before share of results of joint ventures

25

(3) - - 22

Share of Headline results of joint ventures (post-tax)

-

- (2) 1 (1)

Headline EBIT 25 (3) (2) 1 21 Exceptional items* (4) (4) - - (8) Amortisation of acquisition intangibles* (3) (2) - - (5) France (in process of closure) * - (6) (25) - (31)

Statutory EBIT (segment results) 18 (15) (27) 1 (23)

* see note 3 for further details

6 months ended 30 September 2012 (Restated)

CPW

Joint ventures

UK and Ireland

CPW Europe

(see note 8)

Virgin Mobile France

(see note 8) Total £m £m £m £m

Revenue 5 - - 5

Headline EBIT before share of results of joint ventures 2 - - 2 Share of Headline results of joint ventures (post-tax) - (1) 2 1

Headline EBIT 2 (1) 2 3 France (in process of closure) * - 4 - 4

EBIT (segment results) 2 3 2 7

* see note 3 for further details Year ended 31 March 2013 (Restated)

CPW Joint ventures

UK and Ireland

CPW Europe (see note 8)

Virgin Mobile

France (see note 8) Total

£m £m £m £m

Revenue 11 - - 11

Headline EBIT before share of results of joint ventures 3 - - 3 Share of Headline results of joint ventures (post-tax) - 48 3 51

Headline EBIT 3 48 3 54 Share of joint venture exceptional items (post-tax) * - (5) - (5) Share of amortisation of joint venture acquisition intangibles (post-tax) *

- - (1) (1)

France (in process of closure) * - (45) - (45)

Statutory EBIT (segment results) 3 (2) 2 3

* see note 3 for further details

3 Non-Headline items

Non-Headline items comprise: i) French operations

The results, including closure provisions, of the Group’s French business, which is in the process of closure. ii) CPW Europe Acquisition

Exceptional items associated with the transaction.

iii) CPW Europe Reorganisation

Exceptional items incurred in the prior year in relation to restructuring activity within CPW Europe.

iv) Amortisation of acquisition intangibles

Amortisation of acquisition intangibles relating in the current period to the CPW Europe Acquisition.

The items noted above have affected the results of both the wholly-owned Group and the Group’s joint ventures and are analysed as follows:

26 weeks ended 28

September 2013

6 months ended 30

September 2012

Year ended 31 March

2013 Notes £m £m £m

Revenue: French operations i) 40 - - Cost of Sales: French operations i) (30) - - Operating expenses: French operations i) (16) - - CPW Europe Acquisition ii) (8) - - Amortisation of acquisition intangibles iv) (5) - -

(29) - - Share of results of joint ventures (post-tax): French operations i) (25) 4 (45) CPW Europe Reorganisation iii) - - (5) Amortisation of acquisition intangibles iv) - - (1)

(25) 4 (51) Taxation: French operations i) 1 - - CPW Europe Acquisition ii) 1 - - Amortisation of acquisition intangibles iv) 1 - -

3 - -

(41) 4 (51)

(i) French operations

In April 2013 the Group announced its intention to pursue an orderly exit from the French market following a strategic review. The net cash costs of exiting this business are expected to be in the region of £30m, comprising closure costs, the realisation of value on the assets of the business, and operating losses as the closure programme is undertaken. The timing of cash flows will depend principally on the pace of the closure programme, together with the timing of the realisation of value on the assets of the business. Post-acquisition results EBIT losses of £6m, representing gross margin of £10m and operating expenses of £16m, were incurred by CPW following the CPW Europe Acquisition, against which a tax credit of £1m has been recognised. Pre-acquisition results Prior to the CPW Europe Acquisition, the costs associated with France are recognised within the results of joint ventures and are analysed as follows:

Period ended 26

June

6 months ended 30

September

Year ended 31

March 2013 2012 2013

£m £m £m

Operating results (10) 9 8 Taxation on operating results 2 (1) (1)

Post-tax operating results (8) 8 7 Non-cash asset write-downs (8) - (94) Provision for cash costs of exit (35) - (7) Taxation 2 - 5

Post-tax charge (41) - (96)

Total French operations (49) 8 (89)

Group share of French operations within joint ventures (25) 4 (45)

Period ended 26 June 2013 CPW Europe committed to the business closure prior to the CPW Europe Acquisition, and accordingly impaired the business’ non-current assets and recognised a provision for anticipated exit costs during that period. Non-cash asset write-downs totalled £8m, while provisions for exit costs, principally covering redundancies and lease exit costs, totalled £35m. A tax credit of £2m was recognised against these items. Operating losses of £10m were incurred prior to the CPW Europe Acquisition, resulting from the challenging environment that prompted the decision to exit the French market, together with the effects of the announcement of this decision. A tax credit of £2m was recognised against this. The Group’s post-tax share of losses, impairments and provisions prior to the CPW Europe Acquisition was £25m. 6 months ended 30 September 2012 The Group’s French operations recorded EBIT of £9m in the 6 months ended 30 September 2012 against which a tax charge of £1m was recognised. The Group’s post-tax share of these results was £4m. Year ended 31 March 2013 In light of worsening conditions in the French market towards the end of the prior year, the business commenced a review of its operations. As a result a pre-tax charge of £7m was booked in relation to redundancies, lease exit costs and other cash restructuring costs relating to approximately 75 stores which the business had committed to exit at the year end. In addition, the goodwill associated with the French business was written off towards the end of the prior year, alongside various other non-current assets in the business. Together with asset write-downs associated with store closures that were committed during the year, total non-cash asset write-downs of £94m were booked in the year. A tax credit of £5m was booked against these charges, principally reflecting the derecognition of deferred tax liabilities. The Group’s French operations recorded EBIT of £8m in the year ended 31 March 2013 against which a tax charge of £1m was recognised.

(ii) CPW Europe Acquisition

The CPW Europe Acquisition gave rise to a number of exceptional items. Operating expenses include banking and professional fees of £7m in relation to the transaction. Additionally, as a result of the transaction, a number of incentive schemes could not be maintained in their existing form, and they were either allowed to vest early or were replaced during the period. This resulted in cash costs of £8m and an acceleration of non-cash accounting charges of £3m. A tax credit of £1m has been recognised in respect of these costs. The CPW Europe Acquisition required the Group to fair value its existing 50% interest in CPW Europe, which was considered to be equal to the £500m gross consideration for Best Buy’s 50% interest, giving rise to a non-cash gain of £8m. Arrangements with Best Buy allowed the Group to manage the disposal of the Consideration Shares issued to Best Buy, and to benefit from any gain on disposal above a share price of £1.90. The Consideration Shares were placed at a price of £2.44, resulting in a net cash gain of £23m for the Group. The gain implied by comparing the share price at completion, being £2.38, and £1.90, is treated as an adjustment to consideration (see note 4) and the remaining gain of £2m is recorded in the income statement. (iii) CPW Europe Reorganisation

During the prior year, CPW Europe undertook a review of its UK and group operations, with a view to simplifying group functions and giving more autonomy and accountability to individual business units. CPW Europe also initiated plans to reduce its store portfolio and operating cost base across certain Mainland European markets. As a result of this exercise, the business booked an exceptional charge of £18m in relation to redundancies, lease exit costs and other cash restructuring costs.

A tax credit of £7m was recognised against these charges, principally in respect of relief anticipated on cash reorganisation costs and the derecognition of deferred tax liabilities. The Group’s post-tax share of these charges was £5m. (iv) Amortisation of acquisition intangibles

A charge of £5m arose during the period in relation to acquisition intangibles arising on the CPW Europe Acquisition, against which a tax credit of £1m has been recognised. Amortisation in the prior year relates to acquisition intangibles within Virgin Mobile France which arose on the acquisition of Tele2 France in December 2009.

4 CPW Europe Acquisition

On 26 June 2013 the Group completed the CPW Europe Acquisition for a gross consideration of £500m. CPW Europe is one of the largest independent telecommunications specialists in Europe, operating retail stores, principally under the Carphone Warehouse and Phone House brands, together with well-developed online propositions. CPW Europe is also increasingly focused on leveraging its assets and expertise to provide services to third parties through its Connected World Services business.

The primary reasons for the acquisition were to bring a simplified ownership structure, making day-to-day management easier, the strategic decision-making process more streamlined and the ability to better leverage CPW Europe’s asset base and know-how. Such a structure will provide full ownership of growth opportunities across Europe and other potential markets. The acquisition balance sheet remains open until the Group’s full year results are finalised, and may therefore be affected by changes in estimates arising from new information obtained in the second half of the year. On this basis, the acquisition balance sheet is at this stage provisional. The provisional fair values of identifiable assets and liabilities of CPW Europe as at the acquisition date were as follows:

£m

Intangible assets 123

Property, plant and equipment 67

Deferred tax assets 53

Stock 349

Trade and other receivables 1,086

Net cash and cash equivalents 53

Current asset investments 5

Trade and other payables (835)

Corporation tax liabilities (50)

Provisions (62)

Loans and other borrowings (271)

Finance lease obligations (3)

Identifiable net assets 515

Provisional goodwill 497

Total consideration 1,012

Satisfied by: Fair value of existing joint venture investment 500

Cash 370

Deferred consideration 50

Equity 113

Derivative asset (21)

1,012

Net cash outflow arising on acquisition: Cash consideration 370

Less: net cash and cash equivalents acquired (53)

317

Net assets acquired

The fair value of trade and other receivables represents gross trade receivables of £1,109m less amounts not considered collectable of £23m. Provisions include the recognition of contingent liabilities of £9m in relation to legal claims and other potential exposures. It is expected that any costs associated with these contingent liabilities will be incurred over the next four years. The provisional goodwill of £497m arising from the acquisition reflects the fact that CPW Europe’s value is based on its cash generating potential rather than its existing assets, and the fact that many of its key strengths, such as its scale and expertise, do not represent intangible assets as defined by IFRS. None of the goodwill is expected to be deductible for income tax purposes. Consideration

IFRS 3 ‘Business Combinations’ requires that the Group’s existing 50% interest in CPW Europe be revalued to its fair value as part of the acquisition accounting process. The fair value of this interest is considered to be equal to the gross consideration of £500m paid by the Group to acquire Best Buy’s 50% interest in CPW Europe. As the carrying value of the Group’s investment in CPW Europe was £492m at the acquisition date, a gain of £8m has been recognised in non-Headline operating expenses in respect of this revaluation.

Gross cash consideration of £370m was settled on completion, offset by payments from Best Buy of £29m in respect of the prepayment or termination of the Group’s other interests with Best Buy. The £50m of deferred cash consideration, which bears interest at 2.5% per annum, is payable to Best Buy in two equal instalments of £25 million in June 2014 and June 2015. A further £80m of consideration was provided through the issue on completion of 42.1m shares to Best Buy, at a price of £1.90 per share. The Group had the right to place the Consideration Shares on Best Buy’s behalf during the 12 month period to June 2014, and to retain any upside on disposal. The value of the Consideration Shares on completion was £101m, based on a share price at that date of £2.38, and this value is recorded as consideration, with the value associated with the right to place the Consideration Shares recognised as a derivative financial asset of £21m. The Consideration Shares were placed in July 2013 at an average price of £2.44, resulting in a net cash gain of £23m for the Group. The difference between the disposal proceeds and the value of the derivative financial asset has been recognised as a gain of £2m in non-Headline operating expenses. As part of the transaction, the Group agreed to satisfy Best Buy’s obligations in relation to certain incentive schemes. Shares with a value of £12m were issued in respect of Best Buy’s obligations and have been included in consideration. Other information

The results of CPW Europe have been consolidated from 26 June 2013, contributing £856m of revenue and a loss before tax of £8m in the period to 28 September 2013. If the acquisition had completed on 1 April 2013, being the first day of the Group’s financial year, the Group’s revenue would have been £1,654m and the Group’s loss before tax would have been £57m. Transaction-related charges of £18m, comprising banking and professional fees of £7m and cash and non-cash charges relating to incentive schemes of £11m have been included in non-Headline operating expenses, as detailed in note 3. 5 Equity dividends

The following dividends and distributions were paid during the period:

26 weeks

ended 28 September

6 months ended 30

September

Year ended 31

March 2013 2012 2013

£m £m £m

Redemption of 172p per B share through the B/C Share Scheme - 33 33 Final dividend for the year ended 31 March 2012 of 3.25p per ordinary share - 15 15 Interim dividend for the year ended 31 March 2013 of 1.75p per ordinary share - - 8 Final dividend for the year ended 31 March 2013 of 3.25p per ordinary share 19 - -

19 48 56

The proposed interim dividend for the year ending 29 March 2014 is 2.00p per share at an expected cost of £11m. The expected cost of this dividend reflects the fact that the Group’s ESOT has agreed to waive its rights to receive dividends. 6 Reconciliation of Headline results to statutory results

26 weeks ended 28 September 2013 Profit (loss)

before interest, and

taxation Profit (loss)

before taxation

Net profit (loss)

for the period

£m £m £m

Headline results 21 19 14 Exceptional items* (8) (8) (7) Amortisation of acquisition intangibles* (5) (5) (4) France (in process of closure)* (31) (31) (30)

Statutory results (23) (25) (27)

* See note 3 for further details

6 months ended 30 September 2012 (Restated) Profit before interest, and

taxation Profit before

taxation

Net profit for the

year £m £m £m

Headline results 3 4 3 France (in process of closure)* 4 4 4

Statutory results 7 8 7

* See note 3 for further details

Year ended 31 March 2013 (Restated) Profit before interest, and

taxation Profit before

taxation

Net profit for the

year £m £m £m

Headline results 54 56 55 Share of joint venture exceptional items (post-tax) * (5) (5) (5) Share of amortisation of joint venture acquisition intangibles (post-tax) * (1) (1) (1) France (in process of closure)* (45) (45) (45)

Statutory results 3 5 4

* See note 3 for further details

7 Earnings per share

26 weeks ended 28

September 2013

Restated

6 months ended 30

September 2012

Restated

Year ended

31 March 2013

Headline earnings (£m) 14 3 55 Statutory earnings (£m) (27) 7 4

Weighted average number of shares (millions)

Average shares in issue 541 473 473 Less average holding by Group ESOT (2) - -

For basic earnings per share 539 473 473 Dilutive effect of share options and other incentive schemes 7 6 6

For diluted earnings per share 546 479 479

Basic earnings per share

Headline 2.6p 0.6p 11.6p Statutory (5.0)p 1.5p 0.9p

Diluted earnings per share

Headline 2.6p 0.6p 11.5p Statutory (5.0)p 1.5p 0.9p

The dilutive effect of share options relates to an incentive scheme for senior CPW Europe employees, which vested following the CPW Europe Acquisition. Under the scheme, participants had the opportunity to share in earnings in excess of minimum growth targets, against the year ended 31 March 2009. A minimum value of the pool was agreed in the year ended 31 March 2012, in recognition of the value that had already accrued in the scheme in relation to Best Buy Mobile, which was disposed of in January 2012. Further to the CPW Europe Acquisition, the Remuneration Committee allowed the scheme to vest based on performance achieved to 31 March 2013. In addition to the Group’s obligations under the scheme in relation to earnings in excess of minimum growth targets for the years ended March 2010 to March 2013 and the minimum value agreed in relation to Best Buy Mobile, the Group also agreed to satisfy Best Buy’s obligations under the scheme. The Company issued 14m shares in relation to these obligations. Dilution in the current period reflects the dilutive effect of the scheme prior to its vesting and the subsequent issue of shares to satisfy the scheme. Dilution in prior periods relates to the Group’s obligations in relation to the agreed minimum value of the scheme.

The number of shares in issue at 28 September 2013 was 576m, of which 5m were held by the Group’s ESOT.

8 Interests in joint ventures

Interests in joint ventures are as follows:

Business

Principal activities

28 September 2013

30 September 2012

31 March 2013

CPW Europe Retail, distribution, insurance, telecoms services n/a 50.0% 50.0% Virgin Mobile France MVNO 46.3% 46.3% 46.3%

Management of Virgin Mobile France hold warrants that give them the right to acquire new shares at a price based on the value of existing shareholder funding and an additional amount which increases with the quantity of shares being acquired. The maximum potential dilution to the Group’s stake if all existing share options and warrants were exercised is approximately 5.2%, although the value of this dilution would be partially offset by cash inflows in relation to the proceeds on exercise.

a) Group balance sheet interests

The Group’s interests in joint ventures are analysed as follows:

28 September 2013 Net assets

(liabilities) Goodwill Loans Total £m £m £m £m

Opening balance 414 103 20 537 Share of results (26) - - (26) Loans repaid (net) - - (2) (2) Revaluation of interest in CPW Europe 8 - - 8 Disposal of interest in CPW Europe (397) (103) - (500) Foreign exchange (5) - - (5)

Closing balance (6) - 18 12

CPW Europe - - - - Virgin Mobile France (6) - 18 12

Closing balance (6) - 18 12

30 September 2012 Net assets

(liabilities) Goodwill Loans Total £m £m £m £m

Opening balance 409 103 24 536 Share of results 5 - - 5 Loans repaid (net) - - (2) (2) Foreign exchange (7) - (1) (8)

Closing balance 407 103 21 531

CPW Europe 414 103 - 517 Virgin Mobile France (7) - 21 14

Closing balance 407 103 21 531

31 March 2013 Net assets

(liabilities) Goodwill Loans Total £m £m £m £m

Opening balance 409 103 24 536 Share of results - - - - Loans repaid (net) - - (4) (4) Share of other reserve movements 3 - - 3 Foreign exchange 2 - - 2

Closing balance 414 103 20 537

CPW Europe 421 103 - 524 Virgin Mobile France (7) - 20 13

Closing balance 414 103 20 537

Loans are provided to Virgin Mobile France under a shareholder agreement; funding requirements are agreed between the shareholders on a regular basis and are provided in proportion to each party’s shareholding. Virgin Mobile France also has an overdraft facility and a third party three-year financing arrangement to provide funding of up to €25m in respect of capital expenditure.

b) Analysis of profits and losses

The Group’s share of the results of its joint ventures is as follows:

CPW Europe Restated Restated

Period

ended 26 June 2013

6 months ended 30

September 2012

Year ended

31 March 2013

£m £m £m

Revenue 792 1,660 3,694

Headline EBIT * (3) 4 129 Net interest expense (3) (5) (9) Taxation on Headline results 2 (1) (25)

Headline (loss) profit after taxation (4) (2) 95

Group share of Headline (loss) profit after taxation (2) (1) 48 Group share of France (in process of closure) (post-tax) (see note 3) (25) 4 (45) Group share of exceptional items (post-tax) (see note 3) - - (5)

Group share of (loss) profit after taxation (27) 3 (2)

* Headline EBIT includes the unwinding of discounts for the time value of money on network commissions receivable over the life of the customer. This unwind has a value of £2m in the period ended 26 June 2013 (6 months ended 30 September 2012: £4m; year ended 31 March 2013: £9m) and is treated as interest income in the joint venture’s statutory results.

Virgin Mobile France 26 weeks ended 28

September 2013

6 months ended 30

September 2012

Year ended

31 March 2013

£m £m £m

Revenue * 176 192 385

Headline EBIT 3 8 12 Net interest expense (1) (1) (1) Taxation on Headline results (1) (2) (4)

Headline profit after taxation 1 5 7

Group share of Headline profit after taxation 1 2 3 Group share of amortisation of acquisition intangibles (post-tax) - - (1)

Group share of profit after taxation 1 2 2

* Revenue excludes contributions towards subscriber acquisition costs from network operators and customers, as the directors consider that this provides a better representation of underlying performance. These items, which had a value of £20m in the 26 weeks ended 28 September 2013 (September 2012: £30m; March 2013: £74m) are netted off against acquisition costs within Headline EBIT. Reported revenue on a statutory basis for the 6 months ended 30 September 2013 is £196m (September 2012: £222m; March 2013: £459m).

Total Group share Restated Restated

26 weeks ended 28

September 2013

6 months ended 30

September 2012

Year ended

31 March 2013

£m £m £m

Headline (1) 1 51 Statutory (26) 5 -

c) Analysis of assets and liabilities

The Group’s share of the assets and liabilities of its joint ventures is as follows:

CPW Europe 28 September

2013 30 September

2012 31 March

2013 £m £m £m

Non-current assets - 682 548 Cash and overdrafts (net) - 52 124 Other borrowings - (194) (3) Other assets and liabilities (net) - 288 172

Net assets - 828 841

Group share of net assets - 414 421

Virgin Mobile France 28 September 2013

30 September 2012

31 March 2013

£m £m £m

Non-current assets 96 115 100 Cash and overdrafts (net) 2 10 2 Loans from the Group (18) (21) (20) Other borrowings (31) (23) (22) Other assets and liabilities (net) (63) (97) (75)

Net liabilities (14) (16) (15)

Group share of net liabilities (6) (7) (7)

Total Group share 28 September 2013

30 September 2012

31 March 2013

£m £m £m

Total Group share of net assets and liabilities of joint ventures (6) 407 414

9 Financial instruments fair value disclosure

Financial instruments that are measured at fair value in the condensed financial statements require disclosure of fair value measurements by level based on the following fair value measurement hierarchy:

Level 1 – quoted prices (unadjusted) in active markets for identical assets or liabilities;

Level 2 – inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (that is, as prices) or indirectly (that is, derived from prices); and

Level 3 – inputs for the asset or liability that are not based on observable market date (that is, unobservable inputs). The significant inputs required to fair value all of the Group’s financial instruments are observable. The Group only holds Level 2 financial instruments and therefore does not hold any financial instruments categorised as either Level 1 or Level 3 financial instruments. There have also been no transfers of assets or liabilities between levels of the fair value hierarchy. Fair values have been arrived at by discounting future cash flows, assuming no early redemption, or by revaluing forward currency contracts to year-end market rates or rates as appropriate to the instrument.

The directors consider that the book value of financial assets and liabilities recorded at amortised cost and their fair value are approximately equal.

The book value and fair value of the Group’s financial assets, liabilities and derivative financial instruments is as follows:

28 September 2013

30 September 2012

31 March 2013

£m £m £m

Cash and cash equivalents 178 81 117 Loans to Virgin Mobile France 18 21 20 Trade and other receivables 1,027 2 3 Trade and other payables (958) (11) (17) Deferred consideration (50) - - Loans and other borrowings (370) - -

Fair values have been arrived at by discounting future cash flows, assuming no early redemption, or by revaluing forward currency contracts to period-end market rates or rates as appropriate to the instrument.

10 Related party transactions

During the period, the Group had the following disclosable transactions and balances with its joint ventures:

Revenue for services provided relates to investment property rental income.

11 Risks and uncertainties

The Group is subject to a number of risks and uncertainties which could have a material effect on its results. The Group’s

principal risks, and the factors which mitigate them, are set out in the Annual Report on pages 19, 26 and 29, and are

summarised below. These risks remain relevant in the current period. Following the CPW Europe Acquisition, the risks

associated with CPW Europe are now borne entirely by the Group. Additionally, the Group has a higher level of net debt and

committed banking facilities and it is therefore more exposed to fluctuations in interest rates. The Group uses derivative

financial instruments to hedge part of this interest rate risk.

CPW

Uncertain consumer environment

Dependence on key suppliers and customers

Threat of competition

Regulatory issues

Reliance on information technology

Foreign exchange fluctuations Virgin Mobile France

Uncertain consumer environment

Dependence on key suppliers

Threat of competition

Reliance on information technology

No overall control of Virgin Mobile France

12 Statement of directors’ responsibilities

The unaudited interim condensed financial statements for the 26 weeks ended 28 September 2013 have been prepared in accordance with IAS 34 ‘Interim Financial Reporting’, as adopted by the European Union and the Disclosure and Transparency Directive Rules (“DTR”). The interim management report herein includes a fair review of the important events during the first 26 weeks and description of principal risks and uncertainties for the remainder of the financial period, as required by DTR 4.2.7, and a fair review of disclosure of related party transactions and changes therein, as required by DTR 4.2.8.

The directors of Carphone Warehouse Group plc are listed on the Group’s website www.cpwplc.com.

By order of the Board Nigel Langstaff Chief Financial Officer 13 November 2013

26 weeks ended 28 September 2013

6 months ended 30 September 2012

Year ended 31 March 2013

CPW Europe

Virgin Mobile France

CPW Europe

Virgin Mobile France

CPW Europe

Virgin Mobile France

£m £m £m £m £m £m

Revenue for services provided - - 2 - 4 -

Net interest and other finance income

-

-

-

-

-

1

Loans owed to the Group - 18 - 21 - 20

Other amounts owed to the Group - - - - 1 -

Other amounts owed by the Group - - - - (6) -