Heatwaves set to hit Topps Tiles’ profits
Summary
Topps Tiles has warned that its annual profits will fall sharply after weaker consumer spending and disruption from the recent heatwaves hit third-quarter sales. The tile specialist, which has branches in Gloucester and Cheltenham, expects adjusted pre-tax profit for the year to the end of September to come in above £6.5m, down from £9.2m last year.
Details
The company said revenue for the three months to June 27 was £75.6m, down 1.8%, while like-for-like sales across its main Topps Tiles brand were flat. Trading worsened through the quarter as consumer confidence remained under pressure and shoppers increasingly shifted towards lower-priced products.
Topps Tiles said recent periods of extreme heat led to temporary work stoppages among housebuilders and tradespeople, further reducing activity levels. While some of that delayed work is expected to be recovered over the next six months, Topps Tiles warned it was unlikely to come back fully before the end of its financial year in September.
Alex Jensen, chief executive , said: “Topps continues to outperform the wider market despite weaker consumer sentiment and an increased focus on lower-priced products. “We’re making significant strategic progress across our priorities and the self-help actions we are taking to support profitability are working and will position the business for long-term sustainable growth.
“In the short term, the macro-economic environment continues to remain challenging.” Topps Tiles said lower consumer spending and pressure in commercial markets, including housebuilding, continued to weigh on demand. The company has reportedly been taking action to protect profits, including cost-cutting and store estate changes, as it seeks to offset weaker demand and rising operating costs.
Report source: Punchline Gloucester