27th Nov 2018 10:48
LONDON (Alliance News) - Topps Tiles PLC said Tuesday its annual profit fell due to higher costs, despite a small revenue increase.
For the year to September 29, the tile retailer reported pretax profit down 25% to GBP12.7 million from GBP17.0 million a year prior.
The decrease was due to higher distribution & selling costs, which rose to GBP85.6 million from GBP80.0 million a year before. Other expenses also increased, to GBP9.5 million from GBP7.7 million a year ago.
Meanwhile, revenue rose 2.4% to GBP216.9 million from GBP211.8 million. Like-for-like store sales were flat on the prior year; however the company described them as "an outperformance of our market" and "an endorsement of our strategy".
Chief Executive Officer Matthew Williams said: "This has been an important year of strategic progress for the Topps Tiles Group, in which our expansion into commercial has seen us double our addressable market while remaining firmly within our tile specialism, where our buying scale and expertise gives us a significant competitive advantage.
"Against a challenging market backdrop, the group delivered a robust trading performance for the year with flat like-for-like sales and market-leading gross margins in retail, and the foundations laid for significant sales growth in commercial in the year ahead."
The company maintained its final dividend per share at 2.30p, with its total payout kept flat on last year at 3.40p.
Looking ahead, trading in the first eight weeks of the new financial year saw a reduction in revenue, on a like-for-like basis, by 1.9%.
"At the start of the new financial year, trading conditions remain challenging and like-for-like sales in the first eight weeks have been negative against a strong prior year comparator. Whilst retaining a cautious view on the outlook, we remain confident that our expansion into the commercial tile market, coupled with our market-leading retail operation, gives us a solid platform for future growth," Williams added.
Topps Tiles shares were trading down 1.5% at 65.00 pence each.
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