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Carphone Warehouse, the telecoms service provider and Europe’s biggest mobile phone retailer, on Friday said its full-year results would meet analysts’ expectations after reporting a 3 per cent rise in third-quarter retail gross profit.

Revenues from its retail operations grew 19.8 per cent to £571.3m, or by 7.3 per cent on a like-for-like basis, in the third quarter, which includes the crucial Christmas period.

Charles Dunstone, chief executive, said: “We have had another very good Christmas period. Delivering like-for-like growth after last year’s very strong performance is a great achievement, reflecting all our people’s efforts.”

However, the number of customers connected to Carphone‘s unbundled broadband service was lower than some analysts had expected.

Of the 632,000 signed up to Talk Talk Broadband, its high-speed internet service, 540,000 of these are “live” on the service and only 132,000 are on Carphone’s own unbundled lines.

Goldmans Sachs had forecast 189,000 customers would have migrated by the end of last year, while Bear Sterns had hoped that some 150,000 would have been switched over.

Roger Taylor, Carphone’s chief financial officer, said the company had been encouraged by the speed it was moving people over and expected to have 700,000 users on unbundled lines by March.

The number of people connected to Carphone’s higher margin, post-paid mobile phone contracts rose 20.3 per cent to 1.18m while total connections including pre-paid rose 19.2 per cent to 3.26m.

The company also said it increased market share in its retail outlets across Europe.

Improved stock availability in busier outlets had helped lift sales, rather than the popularity of any particular phone handset, according to Mr Taylor.

He sought to allay fears that Vodafone’s decision last September not to allow Carphone Warehouse to sell long-term Vodafone contracts to new customers had hit its business.

“Our customers are looking around for the best offers. They are not looking for one network.”

The shares added 6 ¾p to stand at 329½p in early London trading.

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