Carpetright's UK sales dented by July heat wave
LONDON, July 23
LONDON, July 23 (Reuters) - Carpetright, Britain's biggest floor coverings retailer, posted a fall in first quarter underlying sales in its home market after demand waned in July as temperatures soared putting off consumers from shopping.
The company, which makes about 80 percent of its sales in Britain, said on Tuesday sales at UK stores open over a year fell 1.9 percent in the 12 weeks to July 20.
That compares with a rise of about 5.6 percent in the fourth quarter of the group's 2012-13 year.
Carpetright's efforts to refurbish its shops, broaden its carpet range into higher price points and expand its beds, laminate floor and vinyl tiles ranges have helped the company to attract shoppers over the past year despite tough trading conditions caused by an ongoing squeeze on consumers' disposable incomes.
These initiatives have also helped its gross margin, which rose 80 basis points in the first quarter.
"We saw solid growth in UK sales during May and June, reflecting the continued progress of our self-help activities. During July this positive trend was reversed by the significantly warmer weather," said Chief Executive Darren Shapland.
Like-for-like sales in Carpetright's Europe division - made up of Ireland, Belgium and the Netherlands - fell 10.6 percent, dragged down by weak trading in the Netherlands, the company said. However, gross margin did increase 100 basis points.
"Notwithstanding the tough trading conditions we believe we continue to grow market share in all of our markets," said Shapland.
Shares in Carpetright, up 9 percent over the last year, closed Monday at 688 pence, valuing the business at 465 million pounds ($715 million).