CPW.L Share News (CPW)

Mobile phone retailer Carphone Warehouse is to start paying a dividend after raising its full year earnings forecast on the back of a strong performance from its US operations.It is raising its full-year earnings per share estimate to 13.5p to 14p from a previous range of 11.5p to 11.9p and said it intends to move to a regular dividend policy with a target of about 4.5p a share to be paid in August 2011.The upgrade in earnings expectations reflects an increase in earnings estimates from Carphone's share of its US investment Best Buy Mobile US to £85m to £95m from a previous estimate of £53m to £55m.'A key growth driver is the increasing popularity of smartphones and customers' growing interest in the 'Connected World', coupled with their recognition of our heritage of expertise and independent advice in explaining complex technologies,' said chief executive Roger Taylor.'In the US, Best Buy Mobile is performing even better than we had expected with Best Buy Mobile's US market share now around 5%, compared to around 1% when the venture started in 2006.' Carphone said it expects demand for smartphones (multi-function handsets such as the Blackberry and iPhone) to drive sales in Europe in 2011, once they begin to penetrate the lower end of the market.Increased marketing spend on Best Buy's UK division mean losses are now expected to be between £50m and £55m, compared with previous expectations of £40m to £45m.