Topps Tiles Publishes Annual Results

Topps Tiles Plc the UK's largest tile specialist, has announced its unaudited annual financial results for the 53 weeks ended 2 October 2021.

Strategic and Operational Highlights

•  Record year of revenue for the Group.
• Group market share goal of '1 in 5 by 2025' with good progress made in the year.
• Success in strategic initiatives of expanding value offer, launch of innovative new products and further strengthening our award-winning digital offer.
• Commercial revenue recovering with sales growth in H2 of 55%.
• Launch of new environmental goal of being carbon balanced by 2030

Financial Summary

• Retail like-for-like sales up 19.6% despite trade restrictions throughout Q2.
• Gross margins of 57.3% (FY20 58.5%), reflecting increased investment into value and higher shipping costs.
• Strong recovery in adjusted profit before tax to £15.3 million (FY20 £3.6 million).
• Underlying net cash generation of £12.5 million including £(10.7) million of one-offs from 53rd week and deferred VAT repayment.
• Business well capitalised with strong balance sheet - £27.8 million net cash at year end.
• Strong returns on invested capital - Group ROCE has increased from 13.1% in FY19 to 17.5% in FY21.Dividend reinstated based on 2x full year adjusted EPS cover.

Current Trading and Outlook

• Trading remains robust with two-year Retail like-for-like sales growth of 18.4% in first eight weeks (one-year Retail like-for-like sales down 0.7% against strong comparative period last year).
• Continued trading headwinds from reduced consumer confidence, global supply chain challenges and cost inflation.
• Growth strategy, flexible supply chain and balance sheet strength provide confidence and platform for growth 

Commenting on the results, Rob Parker, Chief Executive said: 

"Our full year results demonstrate the strength of our position as the UK's leading tile specialist and the potential of the business when it has been able to trade without restriction.  Despite significant disruption for a three month period, during which our stores were unable to welcome homeowners, we delivered record revenues for the year and made good progress towards our '1 in 5 by 2025' market share goal.  

"We believe this performance underlines the strength of our strategy and the success of new initiatives including the expansion of our value ranges and the introduction of innovative new products.  The successful development of our digital offer during the year has been particularly pleasing and we have plans in place to expand this further in 2022.

"Trading in the initial weeks of the new financial year has been robust with two-year Retail like-for-like sales growth of 18.4%.  While trading headwinds are likely to continue over the short term, we are confident in our strategy and our ability to deliver sustainable long term growth." 

Notes

¹Retail like-for-like revenue is defined as sales from online and stores that have been trading for more than 52 weeks.  In 2021 like-for-like revenue was £216.6 million (2020: £182.3 million), with an average of 331 stores included in the weekly calculation.

² Adjusted profit before tax excludes the impact of items which are either one-off in nature or fluctuate significantly from year to year.

³ Adjusted earnings per share is adjusted for the items highlighted above, plus the impact of corporation tax

⁴ Adjusted net cash is defined as cash and cash equivalents, less bank loans, before unamortised issue costs.  It excludes lease liabilities under IFRS 16.

Source: Insight Team & Topps  Tiles

For all the very latest news and intelligence on the UK's largest home improvement and garden retailers, sign up for the Insight DIY weekly newsletter.