May 29, 2013 / 8:27 AM / 4 years ago

UPDATE 1-Topps Tiles cuts profit forecast as trade worsens

* Sees FY pretax profit 12.5 mln stg vs 13.3 mln consensus

* Lfl sales down 2.6 pct in first 8 wks of H2

* H1 pretax profit falls 16 pct to 4.7 mln stg

By Neil Maidment

LONDON, May 29 (Reuters) - Topps Tiles, Britain’s largest specialist tile retailer, trimmed its annual profit guidance after trade took a turn for the worse and left it cautious about demand improving this year.

The firm had hoped cost cuts and second-half underlying sales growth would see it meet analysts’ average full-year pretax profit forecast of 13.3 million pounds ($20 million).

However, it said on Wednesday that figure was likely to be around 12.5 million pounds, after like-for-like sales dropped 2.6 percent in the 8 weeks to May 25.

“We see a sort of continuation, maybe with a very slight improvement in the rest of the second half and on that basis the numbers probably will come in a little bit softer at around 12.5 million pounds,” Chief Financial Officer Rob Parker told Reuters, adding 2 million pounds of cost savings would help.

That estimate compares with a 12.8 million pound pretax profit made in 2012. Shares in the firm were down 2.8 percent to 65.25 pence at 0802 GMT.

Like many retailers, Topps Tiles is suffering from low consumer confidence levels as cash-strapped customers hold back on discretionary spending such as home improvements.

The firm, which also sells flooring and has 320 stores, reported adjusted first-half pretax profit to March 30 of 4.7 million pounds ($7 million), down 16 percent from a year ago, but slightly ahead of its recent guidance of 4.3 million.

First-half like-for-like sales fell 0.2 percent after a tough second quarter undid progress at the start of the year. Total revenue grew 0.9 percent to 87.4 million pounds.

Our Standards:The Thomson Reuters Trust Principles.
0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below