Topps Tiles warns the weak economic climate will continue to hit sales

Courtney Goldsmith
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Topps Tiles is still looking to grow via acqusitions (Source: Getty)

The UK's largest tile specialist struggled in the third quarter due to a tough economic climate, but it confirmed it will continue to look for acquisition opportunities.

In a trading update for the 13 weeks to the beginning of July, Topps Tiles revealed like-for-like revenues had fallen by 4.7 per cent.

The firm noted weaker macro-economic conditions hurt sales, but it also pointed out the difficult comparison to the strong performance of last year when the business benefited from the increased level of housing transactions due to the stamp duty changes.

Read more: Topps Tiles' share price slumps as consumer confidence dampens sales

Chief executive Matthew Williams said Topps has seen a "modest" improvement in trading over recent weeks.

Shares in the retailer fell 1.51 per cent to 81.75p in morning trading.

Topps Tiles now trades from 367 stores compared with 348 in 2016, having opened a net nine stores during the quarter. It expects to end the year with around 370 stores.

"Against this background, we will continue to extend our market leadership position by focusing on our proven strategy of 'out-specialising the specialists'.

"In particular, we continue to evaluate selective acquisition opportunities in the commercial segment of the UK tile market," Williams said.

Topps Tiles can be seen as a barometer for consumer confidence as sales reflect the nation's inclination to re-vamp their houses.

Mark Photiades, retail researcher at Cantor Fitzgerald, said today's data implies trading over the most recent six weeks has improved somewhat from the half-year results, and the company still presents a good long-term opportunity for growth.

Read more: Topps of the pile: Tile retailer's shares jump on full-year results

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