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Carpetright profit slump blamed on pre-election jitters

CARPETRIGHT has blamed uncertainty caused by the general election and fears over tax rises for its profit warning yesterday.

The company, which is regarded as a bellwether of UK high street trade, said its profits for the year to 1 May would be below forecasts. Prior to the update analysts were forecasting a consensus pre-tax profit of £36.3m up from £17.2m the previous year.

Carpetright said sales at UK and Ireland stores open over a year increased 1.4 per cent in the seven weeks to 20 March. But the company’s share price tumbled after its bleak trading update, closing 10.9 per cent lower at 825p.

Finance director Neil Page said: “While the bad weather in January clearly impacted sales we would normally expect to recover these once conditions returned to normal.

“The fact that this has not happened is a reflection of the consumer environment, characterised by caution over the forthcoming general election, confirmed prospective increases in taxation and the continued uncertainty over the economic outlook.”