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Carpetright hit by Europe slowdown Carpetright hit by Europe slowdown
(35 minutes later)
Profits at Carpetright, the UK's largest floor coverings retailer, have more than doubled to £9.7m, despite threadbare demand from consumers in continental Europe. But the group also reported hefty exceptional costs – largely losses on store disposals and onerous leases – which left it with a statutory loss before tax of £5.1m. Profits at Carpetright, the UK's largest floor-coverings retailer, have more than doubled to £9.7m, despite threadbare demand from consumers in continental Europe. But the group also reported hefty exceptional costs, largely losses on store disposals and onerous leases, which left it with a statutory loss before tax of £5.1m.
Like-for-like sales in the UK were up 2.2% for the year until the end of April, although revenues were flat, as the floor-covering specialist continued its programme to brighten up its 478 stores. Like-for-like sales in the UK were up 2.2% for the year until the end of April, although revenues were flat, as it continued its programme to brighten up its 478 stores.
Carpetright, which began with a single shop in London in 1988, has also started selling beds and has extended its range of laminated flooring and tiles to attract customers. Carpetright, which launched with a single shop in London in 1988, has started selling beds and extended its range of laminated flooring and tiles.
But the carpet specialist, which does almost 85% of its business in the UK, saw performance dragged down by weak demand from continental Europe. European revenues were down 16%, which Carpetright blamed on weak consumer confidence in the Netherlands. Carpetright also has stores in Belgium and the Republic of Ireland. But the carpet specialist, which does almost 85% of its business in the UK, saw performance dragged down by weak demand from continental Europe. European revenues were down 16%, which the retailer blamed on weak consumer confidence in the Netherlands. Carpetright also has stores in Belgium and the Republic of Ireland.
Carpetright said that "subdued" mortgage approval volumes continues to have an impact on its business in the UK and warned that it was premature to call a wider recovery in the economy. It said subdued mortgage-approval volumes continued to impact on its UK business and warned it was premature to call a wider recovery in the economy.
Darren Shapland, Carpetright chief executive, said he expected trading conditions to remain "challenging", but that the company's "self-help initiatives", such as store revamps, would help underpin positive momentum. Darren Shapland, the chief executive, said he expected trading to remain challenging, but "self-help initiatives", such as store revamps, would help underpin positive momentum.
Philip Dorgan, an analyst at Panmure Gordon, said "the headline profit numbers look good ... but we are disappointed that there is to be no final dividend". Philip Dorgan, an analyst at Panmure Gordon, said: "The headline profit numbers look good … but we are disappointed that there is to be no final dividend."