Electrical retailer Dixons shrugged off a sharp downturn in the mobile phone market as it rang up a seven per cent rise in underlying profits.

A surge in demand for widescreen televisions and DVDs helped it overcome a fall in sales of mobile handsets.

Sales at its mobile phone chain, The Link, were down by 18 per cent in the year to April 27. But the retailer's Currys and PC World divisions both registered gains despite weakness in the personal computer sector.

Total sales across the Dixons group increased five per cent to £4.9bn while like-for-like sales, which exclude income from new stores, were unchanged. Pre-tax profits for the year hit £297.2m before one-off items, up from £277.8m in the previous 12 months.