Topps Tiles cautious on outlook as trade worsens
LONDON May 29 (Reuters) - Britain's Topps Tiles posted a 16 percent fall in first half profit and said trading since has deteriorated, leaving it cautious on its outlook for the remainder of the year.
The UK's largest tile specialist had said in March that despite an expected fall in first half profit due to weak demand, cost savings would keep it on track to meet full-year forecasts, however on Wednesday the firm struck a more cautious tone.
"At this early point in the second half, assessing the likely impact on the full year outcome is difficult, but we continue to be cautious on the like-for-like sales outlook for the remainder of the current year," the company said.
Underlying pretax profit for the 26 weeks to March 30 fell to 4.7 million pounds ($7 million), down from 5.6 million a year ago but slightly ahead of the company's recent guidance of 4.3 million pounds.
First half like-for-like sales fell 0.2 percent, although total revenue grew 0.9 percent to 87.4 million pounds. Underlying sales in the 8 weeks since to May 25 fell 2.6 percent.
Topps, which also sells flooring and trades from some 320 stores, said it would make 2 million pounds of cost savings in the remainder of the year. The group also noted a recent improvement in the UK housing market but said the positive impact on trading would lag any sustained recovery.
Before Wednesday's results Topps Tiles was, on average, expected to report a full-year pretax profit of 13.32 million pounds, according to analysts.
Shares in the firm closed at 66.87 pence on Tuesday, up 35 percent on six months ago, valuing the business at about 129 million pounds.
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