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Gloucestershire Business News

Carpet group sees profits floored in tough retail market

National floor covering group Carpetright has reported a fall in profits in the six months to October 28 due to challenging conditions.

Profit before tax was £0.3 million compared to £4.1 million in the previous year.

Carpetright, which has 462 stores in the UK, warned that profits in the second half of the year would be at the bottom end of the current range of market expectations.

But it said the company had had an encouraging start to the second half of the year with UK like for like sales up 1.4 per cent in the six weeks to December 9.

Commenting on the interim results, Carpetright's chief executive Wilf Walsh said: "The first half has undoubtedly been challenging. Consumer confidence remains fragile and we continue to manage the impact of intensified competition.

"We have made pleasing progress in our core flooring business in the UK - like-for-like sales are up, more than half the UK store estate has now been refurbished and our customer service metrics have been improved significantly.

"However, as previously flagged, our first half profits reflect the impact of the clearance of discontinued lines in our beds business and also unsuccessful deeper discounting promotions in the Netherlands and Belgium, which are now being addressed.

"Looking ahead we will be focused on maintaining sales momentum in UK flooring, capitalising on the much-stronger new range to turn around our beds performance and improving overall trading in the Netherlands and Belgium.

"While trading over the first six weeks of the new period has been encouraging, with an acceleration in like-for-like sales growth in both the UK and Rest of Europe, in light of the consumer outlook we are taking a more cautious view of the second half."

Picture credit: Pixabay

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