27th Jan 2015 08:42
LONDON (Alliance News) - Carpets and floorcoverings retailer Carpetright PC said Tuesday its trading performance improved in the third quarter, posting better sales growth in both the UK and Europe than it did in the first half.
The retail chain, which has finally seen trading pick-up after it managed to return its struggling businesses in the Netherlands and Belgium back to profitability last year, said like-for-like sales, from stores open more than a year, were up 7.5% in the UK, while total sales rose 6.6%, both improvements on the first half. During the first half, total sales were up 5% and like-for-likes up 6.5%.
In Europe - where Carpetright has operations in the Netherlands, Belgium and the Republic of Ireland - like-for-like sales returned to growth of 1.7% in local currency terms, having seen a 0.5% fall in the first half of the year. Total sales declined by 0.8% in the quarter. Taking into account the strength of sterling, total sales from these countries fell 6%, it said, better than the 7.9% decline it reported in the first-half.
Carpetright management have been keeping a tight lid on capital expenditure as the company continues to reduce its store portfolio, closing another four in total in the last quarter.
For the year as a whole, Carpetright said it is still expecting a decline in UK gross profit percentage of between 100 and 150 basis points, with an increase in gross profit percentage of around 250 basis points in the Rest of Europe region.
"In the UK our continued focus on effective promotional activity and the introduction of an interest-free credit offer from Boxing Day has delivered a like-for-like performance slightly ahead of the level experienced in the first half. Sales in our Rest of Europe business have also continued to improve," said Chief Executive Wilf Walsh in a statement.
Carpetright said that trading remains in line with management's expectations, having said last month that it was expecting to report a full-year underlying pre-tax profit towards the upper end of market expectations.
The current range of market expectations for the group is for an underlying pretax profit of between GBP9.0 million and GBP11.0 million for the year ending May 2, 2015, according to Carpetright. Its underlying profit figure excludes exceptional items and related tax.
The company said Tuesday that it will release a pre-close trading update on April 28 and report its full year results on June 30.
Carpetright shares were trading at 453.71 pence Tuesday morning, up 1.6%.
By Rowena Harris-Doughty; [email protected]; @rharrisdoughty
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