UK DIY News
Topps Tiles reports 0.3% rise in Q1 LFL sales
Topps Tiles Plc, the UK’s largest tile specialist, announces a trading update for the 13 weeks ended 31 December 2016.
Like-for-like revenues for the first 13 weeks of the current financial year increased by 0.3%1.
Topps ended the quarter with a total of 356 stores.
1 Quarter 1 includes one additional trading day due to the timing of public holidays which we estimate will have increased LFL sales growth in the quarter by c.0.6%. This effect will reverse during the second quarter
Strategic Progress
We continue to invest in the business and make good progress with our strategy of “Out-Specialising the Specialists”, with specific initiatives in the period including:
Inspiration – during the period we saw the early results from the expanded trade rewards+ loyalty programme. We now have 24,000 participating traders and approximately two thirds of trade sales are linked to the scheme.
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Range – following the exit from low margin real wood flooring in 2016 our enhanced wood effect tile ranges continue to deliver strong growth and the newly launched XL ranges are trading ahead of initial expectations.
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Convenience – we opened five new stores in the core estate during the quarter. The Group is currently trading from 356 stores, including 15 Boutique stores (2016: 340 stores including 13 Boutique stores). We expect to open c.15 new stores in the current financial year.
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People – we have now launched our new employer brand campaign which we believe will increase our attractiveness to new candidates and also help to increase retention of all colleagues.
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Matthew Williams, Chief Executive Officer, said:
“We experienced softer trading conditions during the first quarter but we remain confident that we have continued to outperform the overall tile market. Against this background, our proven strategy, well-invested business and market leading position, leave Topps well-placed for further market share gains in the year ahead.”
Topps will hold its Annual General Meeting on 26 January 2017. In line with previous practice, no further update on trading will be given at this point.
The Company will announce a trading update for the 26 weeks ended 1 April 2017 on 4 April 2017.
Analyst Update
Joshua Raymond, market analyst at XTB.com, comments:
"Investors gave a mixed reaction to Topps Tiles earnings after a sharp slowdown in sales growth for its fiscal first quarter. The firm warned back in October that trading conditions had started to soften and this has reduced investor expectations since then, hence why we have seen a rather muted reaction to the sales slowdown. Nevertheless, this first quarter trading statement should be viewed as yet a warning sign. Not only were like for likes sales sharply lower than previous quarter, at 0.3% compared to 1.4%, but its first quarter also contained an additional trading day which the firm maintained would have had an additional benefit to like for like sales of around 0.6%. So in truth, sales growth of just 0.3% is actually worse than it stands on paper. The continued weakness of the pound and any further hits to UK consumer confidence would likely see a deterioration in Topps Tiles performance this year."
Source: https://www.xtb.com
Source : Topps Tiles
www.toppstiles.co.uk
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