Topps Tiles PLC Trading Update (4209B)
April 04 2017 - 02:00AM
UK Regulatory
TIDMTPT
RNS Number : 4209B
Topps Tiles PLC
04 April 2017
4 April 2017
Topps Tiles Plc
H1 Trading Update
Trading
Topps Tiles Plc (the "Group"), the UK's largest tile specialist,
announces a trading update for the 26 week period ending 1 April
2017. The Board will announce interim results for the period on 23
May 2017.
Total revenues for the 26 week period were GBP106.5 million
(2016: GBP108.0 million).
Like-for-like revenues for the 26 week period decreased by
1.9%.
Trading in the second quarter reflected softer market conditions
and the Group is also reporting against a stronger period from the
prior year when housing transactions accelerated ahead of the Stamp
Duty changes in April 2016.
Lower sales growth over the first half will primarily be offset
by reduced operating expenditure. Based on an improving trend
across the second quarter and a prudent view of the second half,
management expectations for full year profits are within the
current range of analyst forecasts.
Analysis of LFL sales by quarter
Q1 Q2 First Half
--------- --------- ---------- -----------
FY 2017 +0.3%(1) -4.1% (2) -1.9% (3)
--------- --------- ---------- -----------
FY 2016 +4.4% +4.9% +4.7%
--------- --------- ---------- -----------
(1) Quarter 1 in 2017 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 reversed
during the second quarter.
(2) Quarter 2 includes the loss of a trading day explained in
(1) above and also the effect of a later Easter which generates one
additional trading day. These two adjustments broadly offset each
other over the quarter.
(3) The net impact of (1) and (2) over the first half is one
additional trading day which benefits LFL sales growth by
c.0.3%.
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 - the Rewards+ trade loyalty
programme continued to gain traction
and we now have over 35,000 traders actively
collecting points, an increase of 11,000
traders since the end of the first quarter.
-- Range - we have delivered good growth
over the period from our new XL tile
range and extensions to our wood effect
tile offer. These gains have helped to
offset the lost sales following the exit
from the low margin wood flooring category.
We estimate the net position is around
1% less sales and a small positive on
a gross profit basis.
-- Convenience - we opened 10 new stores
in the core estate over the first half
and closed three. The Group is currently
trading from 358 stores, including 15
Boutique stores (2016: 340 stores including
13 Boutique stores). We expect to open
circa 15 net new stores in the current
financial year.
-- People - during the first half we completed
the implementation of a new Learning
Management System and launched our new
employer brand campaign. These initiatives
will help to both increase our attractiveness
to new candidates and retain and develop
our existing colleagues over the longer
term.
Matthew Williams, Chief Executive Officer, said: "Market
conditions over the second quarter have been tougher, but the
business has responded well with tight control of costs. While we
are taking a prudent view on the outlook for the balance of 2017,
an improving trend over the second quarter provides some
encouragement. We will continue to invest in the business and focus
on executing our strategy of Out Specialising the Specialists to
extend our market leading position in the second half of the
year."
(1) The current range of analyst expectations for underlying
profit before tax for the year ended 30 September 2017 is GBP21.0m
to GBP22.3m, with consensus at GBP21.8m.
- Ends -
Enquiries:
Topps Tiles Plc 0116 282 8000
Matthew Williams, Chief Executive
Officer
Rob Parker, Chief Financial Officer
Citigate Dewe Rogerson 020 7638 9571
Kevin Smith / Nick Hayns
Note to editors
Topps Tiles Plc is the UK's largest specialist supplier of tiles
and associated tools and accessories, targeting the UK domestic
refurbishment market and serving a retail and trade customer base
from 358 stores nationwide.
Since opening its first store in 1963, Topps has maintained a
simple operating philosophy - inspiring customers with unrivalled
product choice and providing exceptional levels of customer
service.
For further information, please visit
www.toppstiles.co.uk/media-centre/investors.asp
This information is provided by RNS
The company news service from the London Stock Exchange
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