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Carpetright profits slump 70% in 'challenging' trading | Carpetright profits slump 70% in 'challenging' trading |
(about 2 hours later) | |
Carpetright has seen its annual profits slump by 70% in the face of "very challenging trading conditions". | Carpetright has seen its annual profits slump by 70% in the face of "very challenging trading conditions". |
Pre-tax profit for the year to 30 April was £6.6m, down from £22.3m a year earlier, with trading hit by reduced consumer spending and the continuing weakness in the housing market. | Pre-tax profit for the year to 30 April was £6.6m, down from £22.3m a year earlier, with trading hit by reduced consumer spending and the continuing weakness in the housing market. |
Annual revenues at the carpet and floor covering retailer were 6% lower at £486.8m. Carpetright said it was reviewing the number of its stores. | |
Its shares fell 5% in early trading. | |
The company had already issued two profit warnings earlier this year. | The company had already issued two profit warnings earlier this year. |
Sales pressure | Sales pressure |
Carpetright chairman and chief executive Lord Harris said: "The group faced very challenging trading conditions in the year under review, with fragile consumer confidence producing a weak floor coverings market, leading to a reduction in sales volumes and profitability. | Carpetright chairman and chief executive Lord Harris said: "The group faced very challenging trading conditions in the year under review, with fragile consumer confidence producing a weak floor coverings market, leading to a reduction in sales volumes and profitability. |
"Against this backdrop we have taken a number of management actions to adapt the product proposition whilst retaining competitiveness in the market." | "Against this backdrop we have taken a number of management actions to adapt the product proposition whilst retaining competitiveness in the market." |
During the year, Carpetright reduced its number of stores across the UK and the Irish Republic by 27 to 559, as part of wider cost-cutting measures. | During the year, Carpetright reduced its number of stores across the UK and the Irish Republic by 27 to 559, as part of wider cost-cutting measures. |
Annual revenues at its business in continental Europe were down 8%. | Annual revenues at its business in continental Europe were down 8%. |
The most recent government figures showed that UK retail sales fell 1.4% in May, while the Halifax said house prices last month were 4.2% lower than a year earlier. | The most recent government figures showed that UK retail sales fell 1.4% in May, while the Halifax said house prices last month were 4.2% lower than a year earlier. |
Lord Harris added: "Looking forward I see no respite from the challenging environment over the next year. | Lord Harris added: "Looking forward I see no respite from the challenging environment over the next year. |
"That said, I remain confident the group is well positioned to deliver future profitable sales growth once consumer demand improves." | "That said, I remain confident the group is well positioned to deliver future profitable sales growth once consumer demand improves." |
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