Tile giant posts mixed results as consumer demand weakens
Leicestershire-based Topps Tiles has reported a mixed performance in its results for the 52 weeks to 28 September 2019, but says it hopes to return to growth after the dust settles on the upcoming General Election.
The Group posted revenues of £219.2 million, up 1.1 per cent on the previous year’s figure, but saw its pre-tax profits dip by 1.6 per cent to £12.5 million during the period.
In a statement released to the London Stock Exchange, the firm said that consumer demand has “weakened” since the Election was called in late October.
Reflecting this decline, Topps’ like-for-like retail revenues decreased by 7.2 per cent in the first eight weeks of the new financial period.
However, despite the problems posed by a challenging trading environment, the Group says its entry into the commercial tile market has approximately doubled the size of the its addressable UK market, and its net debt has dropped by £4.9 million.
Topps CEO Matthew Williams said: “This has been another year of strategic progress for Topps, with a resilient sales performance in our retail business and significant development in our commercial operations. In retail, our strategy of ‘Out-specialising the Specialists’ enabled us to deliver like-for-like sales growth and further enhance our market-leading gross margins in tough market conditions. In commercial, we saw significant year-on-year sales growth as we continue to invest in constructing a market-leader over the medium term.
“At the start of the new financial year, trading conditions have become more challenging, with consumer demand weakening further since the General Election was called in late October. Against this backdrop of heightened political and economic uncertainty, like-for-like sales in the first eight weeks have declined. Whilst we expect external events will continue to weigh on consumer confidence for the immediate future, we remain confident that our market-leading retail offer and growing commercial operations give us a strong platform from which to deliver sustainable growth over the medium and long term.”
