The UK’s largest tile retailer, Topps Tiles, has said its historically loss-making commercial business will climb into profitability next year, as it continues to navigate falling consumer confidence, supply chain challenges and historic levels of inflation.
“We remain confident that the business will break even in the second half of the year and then move into profitability in FY23,” the company said in a third quarter trading update today.
Group sales have climbed 9.2 per cent in the third quarter of the year, in comparison with the same period a year prior.
The retailer had performed well over the pandemic, as a lockdown-induced home improvements boom boosted revenue.
In May, Topps Tiles hailed a record turnover for the first half of the year, with Brits still hooked on repairing and improving their homes in the face of record house prices.
An increasing number of Brits have turned to home repairs and re-vamps instead of trading in their home on the market, which helped the London-listed retailer snag £119m in revenue in the six months to 2 April, up more than 15 per cent in comparison with £103m a year prior.
Topps Tiles had acquired a majority stake in a rival online tiling supplier in March with some of its pandemic cash, in a bid to bolster its retail and commercial brands and secure a 20 per cent market share in the UK.
“Sales per store in Topps Tiles remain significantly ahead of our pre-pandemic performance, Commercial and Pro Tiler Tools are growing well year on year, and we have successfully launched our newest brand, Tile Warehouse,” CEO Rob Parker said in a statement today.
“Whilst we are mindful of the current economic pressures and their impact on the outlook for consumers, we are confident that our successful strategy, multiple growth drivers and strong balance sheet leave us well-positioned to deliver medium term growth and our 20 per cent market share goal of ‘1 in 5 by 2025’.”