Topps Tiles says it’s yet to gain from uplift in housing market

Kasmira Jefford
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TOPPS Tiles yesterday said it expected a 23 per cent fall in profits in the first half of the year, blaming the continued weakness in the housing market and subdued consumer confidence.

The UK’s largest tile specialist said it expects underlying pre-tax profits for the 26 weeks to 30 March to be around £4.3m compared with £5.6m last year after an unexpected slowdown in the second quarter.

Like-for-like sales in the second quarter fell 2.2 per cent, dragging first half underlying sales down by 0.3 per cent.

Chief executive Matt Williams was reluctant to blame the weather for the disruption in the second quarter, and said he did not expect it to deter customers from coming to its stores over the Easter weekend.

“The whole weather point for us we play down. It is what it is.”

He added: “The bigger drivers for our market are housing transactions and consumer confidence. Whilst we have seen improving mortgage data, this has yet to translate into our market and housing transactions are still very low.”

Topps Tiles, which runs 320 stores, has been aggressively cutting costs and carrying out “self-help” measures to offset weak demand and said it remained confident of meeting full-year targets.

Analysts have forecast pre-tax profits of between £13.3m to £13.8m, marking the group’s first year of profit growth since 2006.