Carpetright's share price nosed-up around one per cent today despite saying that the weakened pound is impacting profitability across its 429 UK stores.
Updating the market on half-year performance, the Purfleet-based company said costs had increased as a result of sterling's post-Brexit slump and that gross profit margins – the excess that it can sell items over their cost – would be adversely impacted.
Analysts Peel Hunt said that the decrease of between 1.5 and two per cent was more than the zero to 0.5 per cent decrease that it had pencilled in for the firm.
"Trading conditions in the UK in the first half reflect variable consumer demand and increased competitive pressures," said chief executive Wilf Walsh.
However, outside of the UK, where the business has 137 outlets across Netherlands, Belgium and Ireland like-for-like sales had increased and margins maintained.
Carpetright is planning to reinvigorate 100 of its UK stores during the full financial year and Walsh said that the business was on track with this initiative and the benefits of the change were already been felt.
"The initial trading performance of these newly refurbished stores has been encouraging – they are outperforming comparable stores in the estate, giving us confidence that where we invest we are able to drive a material improvement in performance," he said.