22nd Aug 2018 09:12
LONDON (Alliance News) - Headlam Group PLC on Wednesday said it now anticipates full-year results to come in towards the lower end of current market forecasts as profit declined in the first half of 2018 due to challenging market conditions.
Shares in Headlam were trading 4.5% lower on Wednesday morning at 429.38 pence each.
The floorcoverings distributor reported pretax profit of GBP16.4 million for the six months to the end of June, down marginally from GBP16.8 million delivered in the same period a year earlier. Underlying pretax profit rose marginally to GBP17.7 million from GBP17.6 million.
Revenue climbed by 1.0% to GBP337.5 million from GBP334.3 million.
Headlam said revenue in the UK core business was largely unchanged during the period compared with the prior year, with the contribution from acquisitions offsetting the decline in the distribution businesses.
By contrast, Continental Europe achieved a revenue growth of 6.7%, reflecting strong growth in the residential sector.
Meanwhile, first half administrative expenses increased 5.3% year-on-year to GBP91.6 million from GBP87.0 million, driven by acquisitions made over the last 12 months, Headlam said.
Headlam declared an interim dividend of 7.55 pence per share, unchanged from the year prior.
Looking forward, the company said trading for the year-to-date remains broadly consistent with that experienced during the first half.
"We are pleased to report further growth and an increase in our market position during the first six months of 2018," said chief Executive Steve Wilson.
"However, given the current softness in the UK floorcovering market and the associated trading impact on the company's UK businesses," Wilson continued, "the board now expects that the full year outcome, whilst ahead of the full year 2017, will be towards the lower end of current market expectations."
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