Interim Financial Report

19 May 2026

Topps Tiles Plc

Interim Financial Report

Topps Tiles Plc ("Topps Group", the "Company" or the "Group"), the UK's leading tile specialist, announces its unaudited consolidated interim financial results for the 26 weeks ended 28 March 2026.

Strategic and Operational Highlights:

The Company has made significant progress against Mission 365 and the priorities for the year that we laid out in December 2025.

Financial Highlights:

The financial impact of CTD was excluded from adjusted2 measures in FY 2025. In FY 2026 CTD is included in adjusted measures. For comparability, proforma3 financial measures are shown below with CTD trading included in H1 2025.

Financial Summary:

Current Trading and Outlook

Commenting on the results, Alex Jensen, Chief Executive said:

"Topps remains a market outperformer despite a softer backdrop of weaker consumer sentiment, geopolitical uncertainty and the cumulative impact of cost inflation. We are making good progress in delivering our strategic agenda, including a programme of self-help measures weighted towards the second half, and we are accelerating growth in digital, trade and category extensions.  These actions are designed to support modest year on year profit growth and provide a stronger financial platform for 2027, positioning the Group for long-term sustainable profit growth."

Notes

1 Market performance as defined by Barclays "UK Consumer Spend Report" for Home Improvements & DIY which was +0.4% in October 2025, -2.0% in November 2025, -5.4% in December 2025, -2.4% in January 2026, -3.1% in February 2026 and -2.5% in March 2026, averaging c. -2.5% over this period.

2 Adjusted items are Alternative Performance Measures which are used by Group management to plan for, control and assess the performance of the Group. These measures are not defined by IFRS and therefore a reconciliation between each APM and the nearest IFRS measure is presented in the most recent Annual Report and Accounts. Topps Tiles like-for-like revenue is defined as sales from Topps Tiles stores that have been trading for more than 52 weeks and online sales made through the Topps Tiles brand (only). Adjusted sales and profit metrics exclude the impact of items which are either one-off in nature or fluctuate significantly from year to year, described in the Financial Review section of this document.

In the prior year FY 2025 period, the performance of CTD was fully excluded from adjusted metrics due to the ongoing disruption caused by the CMA investigation. In FY 2026, CTD is now included in the adjusted measures which skews comparability year-on-year. 

3 The proforma financial measures add CTD 'trading' back into the H1 2025 base to provide a comparison of performance with CTD included in both the H1 2026 and H1 2025 financial periods. (For comparability, just the trading element of CTD has been added back into H1 2025, not the one-off acquisition, legal and advisor fees relating to the CMA investigation).

4 Adjusted net debt is defined as bank loans before unamortised issue costs, less cash and cash equivalents, as at the balance sheet date. It excludes lease liabilities under IFRS 16.

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INTERIM MANAGEMENT REPORT

Topps Group is the largest specialist distributor of tiles and related products in the UK. Approximately 75% of sales across the Group are made to trade customers, including tilers, general builders and contractors, with the remaining 25% to domestic homeowners. The majority of the Group's sales are ultimately related to work in the domestic repair, maintenance and improvement (RMI) sector, with the balance of sales relating to commercial projects, infrastructure and new build housing.

The Group owns a number of brands which target different customer groups within this market. The largest is Topps Tiles, the market-leading, omni-channel brand, which was founded in 1963 and, with its rich history and 289 stores, has strong brand recognition across the UK, serving both trade and homeowner customers. Pro Tiler Tools is the tile industry's leading Online Pure Play brand focused on trade customers, offering a wide range of trade-focused essentials items and a deep product specialism, at market-leading pricing. The Parkside brand operates in the commercial market which includes tiles supplied across sectors such as leisure, retail, hospitality, infrastructure and offices, where product specification is heavily influenced by the architect and designer community. CTD joined the Group in August 2024 and has over 50 years of experience serving the trade, the commercial market, and the housebuilder sector. Fulfilment for both Parkside and CTD is direct to customer, and via dedicated housebuilder hub stores and increasingly via the store estate. Fired Earth was acquired in H1 2026 and allows us to access the premium tile market.

All of our brands derive benefit from the scale of the Group, our market position as category experts, and our cross-group focus on top quality service. We enjoy a competitive advantage in sourcing differentiated products from around the world that we often access on an exclusive basis. Our strategy is underpinned by our people strategy, which delivers world-class customer service across the Group, our operational and digital excellence strategy, including a high-quality, specialist supply chain and ongoing investment in systems, and our environmental leadership strategy, including our goal of being carbon neutral across Scope 1 and 2 emissions by 2030.

STRATEGIC AND OPERATIONAL REVIEW

The Company has made significant progress against Mission 365 and the priorities for the year that we laid out in December 2025.

1) Focus on driving profitability and improving PBT margin: 

We have increased our focus on profitability. We continued to improve underlying gross margin in the first half, with margin expansion across Topps Tiles, Pro Tiler and CTD, driving a 1.6ppts uplift on a proforma basis. Adjusted gross margin % year‑on‑year reduced from 53.4% to 53.0% due to the inclusion of CTD, a structurally lower‑margin business, into adjusted numbers.

Our Topps Tiles store estate makes up around 60% of the Group's cost base, operates with a relatively inflexible labour model, and has been exposed to government-led inflation, in the form of National Living Wage, where rates have risen by 29% over the last three years.

In addition to cost control on COGS, we therefore implemented three business‑specific transformation plans to improve profit and improve PBT margin.

In January 2026, we communicated to our organisation the closure of 23 loss‑making stores over nine months in 2026. Most of these stores were close to other locations, allowing a proportion of sales to transfer (c. 20-40% transfer observed in previous programmes), making the programme profit accretive.

Across the remaining estate, we are rolling out a new store productivity model designed to better match staffing to customer demand. This dynamic approach increases flexibility and brings our labour model in line with best practice in retail.

We have also consolidated a number of roles in head office and central functions and reinvested some of the savings back into areas where we see the largest growth momentum.

These programmes are weighted into H2 and full benefits will be realised in 2027. Across all 3 they are expected to deliver c. £3m H2 benefit and c. £6m sustainable annual benefits to offset future inflation and headwinds.

2) Delivering trade growth strategy:

With trade customers using the Group's brands frequently and acting as brand ambassadors to other traders and to homeowners, we maintain our focus on expanding trader acquisition and loyalty. Our trade strategy continues strongly, now representing c. 75% of the Group mix. In H1 we delivered 4.1% growth in trade excluding CTD (0.9% including CTD, due to the revenue lost during 2025 due to the CMA process).

In Topps we strengthened our proposition to the trade segment, placing a clear emphasis on convenience and value. In February, we launched live stock visibility enabling our trade customers to see precise in-store availability on essentials items. This capability was particularly important to support the app launch that went live in May and improves planning and efficiency for our customers.

We achieved a 55% increase in the adoption of Trade Pay, our trade credit offering, compared to prior period, with 11% of trade customers using this facility. By improving access to flexible payment options, we are better supporting their ability to scale their business, and Trade Pay customers spend 5 times as much as non-Trade Pay customers. This offer is executed in a disciplined, risk-assessed way in coordination with our credit control team.

Pro Tiler Tools continues to take market share and deliver strong financial results. In the six-month period, sales of £18.4 million were up c. 20% year on year, with current sales levels about three times higher than at the point of acquisition in 2022. Growth has been delivered by continued operational improvements, including an industry-leading value proposition, specialised capability in digital marketing and the expansion of our own-brand, PremTool, which supports both revenue growth and margin expansion. We see further opportunities to grow Pro Tiler.

3) Digital acceleration:

Online revenue rose to c.21% (H1 2025: c.18%). In Topps Tiles, we launched our new trader app in May. This represents a step-change in the value proposition we are offering this segment, particularly around convenience and the ease with which they can now trade with us. Main benefits include live stock feeds and fast access to click & collect, better loyalty visibility with a rewards ladder, improved access to Trade Pay, exclusive app offers and discounts to drive Average Transaction Value and frequency.

H1 marked the first 6 months that we used CRM capability, having launched it in Q4 2025. Already our email open rates are 20% higher than the industry average. The launch of the app, enables us to personalise this, improving effectiveness and efficiency of marketing spend. The app, with the link to CRM is a cornerstone for the next phase of trade growth in Topps and we expect to see an improvement in trade sales in H2. 

Across the Group we improved our website capability, with new websites launched for CTD, Topps retail and Fired Earth. In Topps, year on year conversion is up 16%, checkout abandonment has decreased by 20% and speed has improved by 30%. The number of products with reviews has increased by 10% to 44%, 2ppts higher than the industry average. At the same time, we are increasing our focus on Search Engine Optimisation and Generative Engine Optimisation, with organic visibility improving by 25% since the start of the year and the highest share of voice and AI citations amongst our competitor set.

The Group-wide system modernisation rollout is well underway, with the ERP upgrade (Microsoft Dynamics 365 Business Central) all on track to be completed by year end across central functions, the Topps Tiles and CTD store networks, with Parkside, to follow in 2027 as planned. Pro Tiler Tools runs on a different system, and we will revisit this architecture following the core systems upgrade. As part of this upgrade programme, we are enhancing our point-of-sale infrastructure by introducing tills with customer-facing display screens. This will enable the integration of CRM data, allowing us to deliver more personalised promotional messaging to individual customers and, over time, support self-service capabilities.

4) Driving sales excellence:

Our fourth priority is to drive sales excellence in Topps Tiles by converting our differentiators into stronger sales performance. These differentiators include market-beating product expertise and high-quality customer service.

In H1, we invested in sales capability-across people, process and performance-to improve in-store labour productivity. This drove higher conversion rates and increased average transaction values. We trained over 1,000 colleagues in a Topps-specific, benefits-led selling programme, strengthened the use of our customer pipeline tools, and reset commission schemes to reward these behaviours and outcomes.

We strengthened our position in the value segment through targeted pricing on key items in Topps Tiles, driving gross profit improvement. We also simplified our customer proposition by consolidating Tile Warehouse into the Topps Tiles brand. While Tile Warehouse delivered c. 23% growth in the first half, operating two brands constrained our ability to present a coherent, seamless offer to customers. Bringing this together allows us to build on the momentum achieved by both brands, whilst better leveraging the reach and efficiency of the Topps Tiles brand.

In the period we grew category extensions by 7% with acoustic panels and shower panels performing particularly well. We have plans to ramp up investment and focus on category extensions in H2.

Our focus on driving sales is underpinned by excellent customer service, with Google reviews averaging 4.9 stars across 85,000 reviews, supporting local visibility and customer confidence. Having a reputation for good customer service supports local visibility and customer confidence and it is also a key feed for generative engine optimisation where reviews are an important input into the AI answer.

5) Integrating acquisitions to drive sustainable profit:

CTD has delivered +1.0% like-for-like revenue in its stores and more than halved losses to £0.4m, improving by £0.6m year-on-year. It is on track to be profitable in the second half. Two new housebuilder hubs, dedicated to housebuilder needs, with racked warehouse, specified coverings and curated essentials ranges are being opened in H2 2026, with CTD Minworth open in May, and CTD Newcastle opening in Q4.

We continue to grow our Parkside business, which made a small profit in 2025 and is building momentum. We secure project specifications with architects and designers, while also targeting contractors delivering these projects. By leveraging our combined CTD and Topps store network, we are making it easier for customers to access what they need and growing the business.

Fired Earth expands our addressable customer base into premium, strengthens our proposition to homeowners and housebuilders and accelerates our digital penetration. By incorporating it into the Group, we leveraged the advantages of group sourcing and logistics scale, group digital capability, all whilst preserving the integrity of the Fired Earth brand.

Fired Earth sales are exceeding expectations, and the brand is already profitable in the first 4 months of trading. In H1 we secured long term collaborative design partnerships with Nina Campbell and Neisha Crossland, an important aspect of newness and inspiration for Fired Earth customers. In May we launched a paint collection with 120 colours. Alongside our UK stockists, we have extended the brand reach via international stockists in 4 countries. We see international expansion as a good opportunity for a strong brand with clear brand differentiation around heritage, artisan craftsmanship and quality.

Summary

We have increased our focus on profitability. We continue to generate a strong gross margin and have initiated and executed three self-help initiatives to tackle unsustainably high costs driven principally by government-led inflation. These initiatives have been executed and will underpin profit delivery in H2 2026 and future years.

We are making good progress in delivering our strategic agenda, accelerating growth in digital, trade and category extensions. In Q2 we refreshed our strategy. The refresh confirmed a market valued at c. £2.4 billion in 2025, with 50% of this in tiles and related ancillaries and 50% in new coverings such as luxury vinyl tiles and outdoor tiles and related ancillaries. We look forward to sharing the evolution of Mission 365 as part of our full year results presentation.

Key Performance Indicators ("KPIs")

As set out in our most recent Annual Report, the Board monitors a number of financial and non-financial KPIs when reviewing the implementation of the Group's strategy. Our performance in the 26 weeks to 28 March 2026 is set out in the table below, together with the prior year performance data. One KPI, total scope 1 and 2 net carbon emissions (tonnes per annum), is only available on an annual basis and so is not disclosed here. The source of data and calculation methods are consistent with those described in the 2025 Annual Report.

In FY24 the business acquired CTD which was removed from the 'adjusted' measures in the 2024 and 2025 financial years. However, in the 2026 financial year, the sales, margin, costs, profit and other financial metrics have been brought fully into the 'adjusted' measures illustrated below. For comparative purposes, Adjusted Revenue growth/(decline), Adjusted Gross Margin %, Adjusted Profit Before Tax, and Adjusted Earnings Per Share have been shown as a proforma whereby CTD Trading has been added back into to H1 2025 numbers to provide a like-for-like comparison (note the 'one off' elements of CTD relating to acquisition costs and CMA investigation have been excluded, meaning just the trading elements have been included in the proforma view):

 * as defined in the Financial Review

FINANCIAL REVIEW

H1 2026 covers the 26 weeks to 28 March 2026. The previous period ('H1 2025') covers the 26 weeks to 29 March 2025. 

The addition of CTD into the 'Adjusted' financial measures in H1 2026 drives positive sales growth year-on-year of 11.6%, given CTD did not form part of the 'Adjusted' financial measures in the H1 2025 period. On a proforma and statutory basis (CTD in both H1 2026 and H1 2025) revenue growth is marginally down 0.2%, albeit ahead of a weak market. Within this Topps Tiles like-for-like revenue in the half shows a small increase of 0.1% with consumer confidence increasingly impacted by wider macro and geopolitical factors.

At an adjusted profit before tax level, the Group delivered £2.2 million in the first half of 2026, versus £3.2 million in H1 2025. However, on a proforma basis, with the £1.0 million CTD trading loss included in the H1 2025 base, adjusted profit before tax of £2.2 million is flat year-on-year.

Key financial results are as follows:

Acquisitions

CTD

In August 2024 the Group acquired the brand and certain assets from CTD Tiles Limited (in administration) including the right to occupy 30 stores, selected stock, intellectual property and branding. 

As the Group fully integrates this acquisition, the performance of CTD has been incrementally improving, particularly following the completion of the CMA process in late 2025. The Group has continued to focus on cost discipline, optimising the operating model to deliver synergies, driving store performance through the 22 CTD stores that it currently operates from, and recovering the Housebuilder business which was impacted following the prolonged CMA process. As a result, the loss across the first half 2026 has been reduced to £0.4 million compared to a trading loss in H1 2025 of £1.0 million. The Group is continuing to focus on bringing the CTD business to profit in the second half and sustainable profit thereafter.

* Note that just the trading loss has been added back into the H1 2025 base for the proforma view. Other one-off legal and advisor costs relating to the acquisition and consequent CMA process have been excluded.

In both the 2024 and 2025 full year results, CTD's performance was excluded from adjusted profit metrics, including its trading performance, acquisition costs, and the costs of the CMA investigation. However, in FY 2026, CTD's results are now being included in the adjusted profit metrics of the Group, which given CTD remains loss making, has introduced a £0.4 million drag on reported adjusted profit before tax in H1 2026. 

The table below illustrates the impact of this, showing that adding the CTD trading loss into the H1 2025 base provides a more comparable proforma view of year-on-year profitability:

* Note that just the trading loss has been added back into the H1 2025 base for the proforma view. Other one-off legal and advisor costs relating to the acquisition and consequent CMA process have been excluded.

Fired Earth

On 26 November 2025, the Group acquired - from administration - the Fired Earth brand, associated IP, website and a provisional £2.5 million of stock, for a total cash consideration of £3.0 million. Significant focus was placed on re-establishing the business, such that by 16 December 2025, Fired Earth was trading through a fully transactional website. Trading performance has continued to build, and Fired Earth has already delivered a modest profit in the first half, whilst delivering revenue of c. £1m. Given the newly acquired Fired Earth brand was brought under the control of the Group almost immediately after acquisition, and then the trading was re-established shortly after, and from a materiality perspective the values are fairly modest, the Group has brought the core underlying trading metrics into its "Adjusted" financials immediately, with only the one-off acquisition costs being treated as adjusted items. This approach differs versus the treatment of CTD which was a larger transaction and was severely hampered by the prolonged CMA process which meant the Group was not able to gain trading and operational control over CTD until well after the acquisition.

Following the acquisition of Fired Earth, the Group is required to account for the acquired assets and liabilities in accordance with IFRS 3 Business Combinations. As permitted under IFRS 3, the acquisition accounting has been recognised on a provisional basis at the reporting date, reflecting the fact that the valuation exercise is not yet complete.

IFRS 3 permits the use of provisional amounts where the initial accounting for a business combination is incomplete, with retrospective adjustment of those amounts permitted during a measurement period of up to 12 months from the acquisition date. The Group expects to finalise the acquisition accounting prior to 25 November 2026, with the final values to be reflected in the FY26 results.

Tile Warehouse - Consolidation into Topps Tiles

The Group's Online Pure Play brand Tile Warehouse, which focuses on the value DIY customer, was launched in May 2022 and delivered sales of £3.0 million in the 2025 full financial year and £1.7 million in H1 2026. From a profit perspective, the brand delivered a loss of £(0.5) million in the 2025 financial year and, whilst the position has improved slightly, remains in a loss-making position in H1 2026.

Following a detailed review, the Group has made the decision to consolidate the Tile Warehouse business into Topps Tiles allowing us to serve value led customers more efficiently and sustainably. Focusing efforts behind a Topps Tiles value proposition allows the Group to invest in a brand with greater market reach and penetration, stronger customer recognition, and a proven margin profile.

Execution of this change will occur across H2 2026, with the financial impact being accretive to the Group. The Group anticipate that the operating cost savings, alongside transfer of existing Tile Warehouse trade into the Topps Tiles brand, will more than offset the loss of revenue from retiring the Tile Warehouse brand. Note that the one-off costs associated with executing this change will be reflected as an adjusting item and removed from adjusted profit before tax.

Consolidated Statement of Profit or Loss

Topps Group adjusted revenue growth of +11.6% in the 26 weeks ended 28 March 2026 was supported by bringing CTD into the adjusted financials in H1 2026, whereas in financial years 2024 and 2025 it was excluded from the adjusted financials. Group statutory revenue, with CTD included in both H1 2026 and H1 2025, was marginally down 0.2% year-on-year. Within this, Topps Tiles revenue, which represents nearly 75% of Group revenue, was marginally down 1.7% year-on-year, driven by the closure of 8 stores in the period, whilst Topps Tiles like-for-like sales delivered a modest growth of 0.1% in the half.

Sales in Online Pure Play remained very strong, up 25.6% to £21.1 million. Within Online Pure Play, Pro Tiler Tools continued to deliver excellent growth, up c. 20% year-on-year to £18.4 million. The introduction of the newly acquired Fired Earth brand also delivered £1.0 million of revenue in the half following its acquisition in November 2025. Parkside, our commercial 'architecture and design (A&D)' brand saw flat sales of £3.9 million in the half. Revenue by business area is illustrated below, with the impact of CTD also highlighted:

*Online Pure Play includes Pro Tiler Tools and its associated brands, which were acquired in March 2022, Tile Warehouse, which was launched in May 2022 (and will be consolidated into Topps in H2 2026) and Fired Earth which was acquired in November 2025 and trading re-established in December 2025.

** CTD was acquired in August 2024. Please see the section above for further information.

Adjusted gross profit of £75.6 million was £7.4 million higher year-on-year (H1 2025: £68.2 million) driven by the introduction of CTD into adjusted measures in 2026. On a proforma basis with CTD included in H1 2025, gross profit increased £2.1 million year-on-year with both online driven sales growth and higher margin rates in Topps Tiles and Pro Tiler the key drivers. 

Whilst the adjusted gross margin has stepped back 0.4 ppts year-on-year to 53.0%, this is primarily a mix impact given the structurally lower margin CTD business is included in H1 2026 measures but not in H1 2025. The adjusted gross margin on a proforma basis has increased 1.6 ppts year-on-year with Topps Tiles the key driver of the growth. Within Topps Tiles margin has grown 1.8 ppts (contributing 1.7 ppts to overall Group margin) where the impact of the higher mix of trade and essentials is fully offset by management action on cost of goods and pricing. 

The table below provides context on the drivers of gross margin year-on-year:

Adjusted operating expenses of £69.5 million increased by £7.5 million year-on-year, primarily due to bringing the CTD business into the adjusted measures in financial year 2026. On a proforma basis with CTD included in both years, operating expenses have increased by £1.2 million with management driven cost savings largely offsetting inflationary headwinds and growth investments. The table below summarises the movements in operating expenses year-on-year, including highlighting the impact of CTD:

Cost inflation was spread across a number of lines, including wage inflation (driven by the 6.7% increase in National Living Wage and the increase in the rate and reduction in the threshold of employers' NICs, both from April 2025), and property costs. Growth investments reflect the continued sales momentum in Pro Tiler Tools, which drove associated cost growth (albeit at a lower rate than revenue), particularly in digital marketing and the supply chain following the relocation to the new Prologis Park distribution centre part way through H1 2025. In addition, the acquisition of Fired Earth during the period increased the Group's operating cost base, although this was more than offset by its strong trading performance. The Group also continued to invest in strategic capability, including the ERP upgrade and Trade App. These cost increases were partly mitigated by self‑help savings, with CTD costs reducing year‑on‑year compared to H1 2025 due to a smaller store base and the realisation of Group cost synergies. Within Topps Tiles, further savings were delivered through fewer stores year‑on‑year alongside ongoing cost efficiency initiatives.

Adjusted operating profit was down 1.6% to £6.1 million (H1 2025: £6.2 million), however, proforma adjusted operating profit (CTD included in H1 2025 base) was up 17.3% given solid gross margin growth and tight operating cost management.

Adjusted net finance costs were £3.9 million in H1 2026 (H1 2025: £3.0 million), as a result of higher IFRS 16 interest charges driven by the inclusion of CTD stores in adjusted measures in the current year and the full-year impact of the Prologis Park Pineham distribution centre, which was partially excluded in the prior year while non-operational. Statutory interest costs were £3.9 million (H1 2025: £3.3 million), broken down as follows:

Adjusted profit before tax for the period was £2.2 million (H1 2025: £3.2 million). On a proforma basis, adjusted profit before tax of £2.2 million was flat year-on-year, with CTD's trading loss of £1.0 million included in H1 2025.

After including the adjusting items described in the next section, the statutory profit before tax was £0.5 million (H1 2025: £1.9 million).

Adjusting items

The Group's management uses adjusted performance measures, to plan for, control and assess the performance of the Group. Adjusted profit before tax differs from the statutory profit before tax as it excludes the effect of one-off or fluctuating items, allowing stakeholders to understand results across years in a more consistent manner. We have excluded property costs in relation to both the prior store closure programme, which concluded in 2022, and the latest store closure programme announced earlier this year. The current programme forms part of wider cost-saving initiatives, including the closure of 23 underperforming stores across the financial year.

In line with prior years, we treat any impairment charges or impairment reversals of right-of-use assets, derecognition of lease liabilities where we have exited a store, and one-off gains and losses through sub-lets as adjusting items. From the 2024 full year results, we have also excluded impairment and impairment reversals of plant, property and equipment from adjusted profit, as the impairment of these assets is a result of the same impairment review process applied to right of use assets, implying the same accounting presentation. In addition, the impact of these impairments is excluded from adjusted profit. Impairments imply that assets will not incur a depreciation charge moving forward in statutory profit, however, the Group's adjusted profit before tax measure will carry a notional depreciation charge, as if the assets had not been impaired, meaning that adjusted profit before tax will continue to be comparable year on year, and is more reflective of the actual lease payments made by the Group. None of these impairments / lease gains and losses have any cash impact, in 2024 or in future periods.

In the prior period, the Group relocated the warehouse operations of both Pro Tiler Tools and CTD into a distribution centre at the Prologis Park Pineham. The costs associated with the warehouse before operational use, costs associated with the warehouse being exited, and the relocation of the Pro Tiler operation to the new facility, were excluded from adjusted profit.

In August 2024, the CTD brand and certain assets were acquired from administration and in the prior year, the financial impact of this business, including its trading performance, one-off items and non-recurring costs, and the costs of advisory fees relating to the CMA investigation were excluded from adjusted profit. The CMA's Initial Enforcement Order had the effect of keeping CTD at arm's length of the company's management and prohibiting further integration which would have improved the business's financial performance. In the current year, CTD's trading performance has been included within adjusted profit, with the exception of one-off and non-recurring costs and CMA-related advisory fees.

Costs associated with the acquisition of Fired Earth, including legal and other professional fees, have been identified as non-recurring in nature and have therefore been excluded from adjusted profit. This treatment ensures that the reported performance reflects the ongoing operational activities of the business. Restructuring costs and other one-off costs have also been excluded.

During the period, the previously announced senior management changes progressed, including the retirement of Rob Parker as Chief Executive. Several management transition costs were incurred, including dual‑running and recruitment‑related costs, all of which have been treated as adjusting items.

An analysis of movements from adjusted profit before tax to statutory profit before tax is given below:

Tax and earnings per share

The tax expense was £0.1 million (H1 2025: £0.7 million). On an adjusted basis, the tax expense was £0.5 million (H1 2025: £1.0 million) and the effective tax rate for the period was 24.2% (H1 2025: 30.3%), slightly lower than the headline rate of corporation tax in the UK of 25% as a result of certain disallowable expenses offset by the movement in share based payment and the net impact of depreciation compared to capital allowances.

Adjusted earnings per share were 0.83 pence, down 25.9% when compared to 1.12 pence in H1 2025, mirroring the reduction in adjusted profit year-on-year, driven by the inclusion of CTD losses in H1 2026 (excluded from H1 2025). On a proforma basis (CTD trading reflected in H1 2025 base), adjusted earnings per share is up 13.7%. 

Basic earnings per share were 0.17 pence (H1 2025: 0.61 pence).

Dividend

Under the Group's capital allocation and dividend policy, interim dividends are set at one third of the full year dividend from the previous year. The full year dividend relating to FY 2025 was 2.9 pence and, as such, an interim dividend of 1.0 pence has been declared by the Board (H1 2025: 0.8 pence). The shares will trade ex-dividend on 4 June 2026 and the dividend will be paid on 10 July 2026.

Consolidated Statement of Financial Position and Consolidated Cash Flow Statement

Capital Expenditure and Store Estate

Capital expenditure in the first half was £2.3m (H1 2025: £4.0m) with the investment focused on our digital acceleration including the upcoming Topps Trade App and personalisation of our Customer Engagement Platform ('CEP'), expenditure on the new till systems and ERP upgrade, and investment in existing stores. The year-on-year reduction in capital expenditure is largely driven by last year's investment in the Group's new distribution centre to support the Pro Tiler Tools and CTD operations. 

In the period, no new Topps Tiles stores opened and eight Topps Tiles stores closed. At the period end there were 289 trading stores (H1 2025: 298 stores). We retain significant flexibility within our store estate, with an average unexpired lease term of 2.5 years (H1 2025: 2.8 years), or 2.2 years excluding strategically important stores (H1 2025: 2.7 years). At the period end, there were six closed stores (H1 2025: one closed store), some of which are expected to be exited in the second half of the year.

Inventory

Inventory at the period end was £41.9 million (H1 2025: £40.3 million), representing 110 stock days (H1 2025: 114 stock days). This includes £5.0m million of stock held in Pro Tiler (H1 2025: £4.1 million), representing 68 stock days (H1 2025: 66 stock days) and £4.8 million of stock held at CTD (H1 2025: £5.4 million), representing 102 stock days (H1 2025: prior year inventory days were distorted by the short period of CTD trading in H2 2024). At the last year end, inventory was £40.6 million, equivalent to 105 stock days.

Consolidated Cash Flow Statement

The Group's adjusted net cash/(debt) position decreased in the period by £10.5 million from £7.4 million of adjusted net cash at year end to £3.1 million of adjusted net debt at the half year end. Adjusted net cash/(debt) is defined as cash and cash equivalents, less bank loans, before unamortised issue costs. The table below analyses the Group's adjusted net cash flow:

Cash generated by operations, after leases but before working capital movements and excluding CTD was £4.9 million, £0.7 million higher than the previous year. A working capital outflow excluding CTD of £6.2 million in the first half (H1 2025: outflow of £4.5 million) was driven by a reduction in trade creditors versus the year‑end, reflecting the normal unwinding of elevated year‑end purchasing ahead of the peak trading period, compounded by weaker Q2 trading resulting in lower purchasing levels. Softer trading in Q2 also led to a reduction in VAT payable, creating a further cash outflow compared with the year‑end position. There was also an increase in Pro Tiler stock vs year-end, resulting in a cash outflow, reflecting strong growth. In addition, H1 includes the payment of the prior year head office bonus, which was higher than the equivalent payment made in the prior year, increasing the year‑on‑year outflow. CTD cash flows were an inflow of £1.1m, driven by a reduction in stock across the first half. Capital expenditure is detailed in the section above. Net interest paid was a £0.4 million cash outflow, which was flat year-on-year. Cash tax payments were nil in the first half as a result of statutory losses made in prior years, however dividends were up year-on-year, with the payment in the first half being in relation to the FY 2025 final dividend of 2.1 pence per share (H1 2025: final dividend of 1.2 pence per share). The acquisition of certain assets of Fired Earth resulted in a £3.0 million outflow in the first half.

Return on Capital Employed

Lease adjusted returns on capital employed in the first half were 15.0% (H1 2025: 12.9%), based on an increase in the rolling 12-month adjusted operating profit compared to the previous year, in particularly the second half of FY 2025. 

Banking Facilities

The Group maintains a robust balance sheet, providing resilience and allowing investment in growth opportunities. A £30.0 million revolving credit facility is in place which is committed to October 2027 (H1 2025: £30.0 million facility, committed to October 2027). At the half year, £19.0 million of this facility was drawn (H1 2025: £14.0 million drawn) following £3.0 million required for the Fired Earth acquisition in H1 2026, alongside higher year-on-year dividend. Based on a closing net debt excluding lease liabilities position of £3.1 million at the period end, the Group had £26.9 million of headroom to its banking facilities at the period end (H1 2025: £28.8 million).

Forward Guidance

Certain factors weight profit to the second half:

Current Trading and Outlook

The macro environment remains challenging, given ongoing political unrest and weak consumer sentiment. Despite this, through self-help management intervention and a strong focus on delivering for the customer, trading has shown an improving trend across the start of the second half. The first seven weeks of the second half have seen Topps Tiles like-for-like revenues return to a positive position, up 0.6%, which follows a challenging second quarter performance where like-for-like revenue was down c. 2%. In the same period CTD store like-for-like revenues have also increased 3.0%. The Group is also seeing a continuation of the strong growth of its online brands in the first seven weeks of the second half, with Pro Tiler recording record sales weeks in this period.

The combination of strong strategic execution of self-help interventions benefitting the second half, coupled with accelerating growth in digital, trade and category extensions, gives the Group confidence that it will deliver modest year-on-year profit growth in line with market expectations, assuming macro conditions and consumer confidence do not deteriorate further.

Risks and Uncertainties

The Board continues to monitor the key risks and uncertainties of the Group on a quarterly basis as part of their core governance processes. No principal risks have been removed since the 2025 Annual Report, but some have been amended given the increased macro-economic and geopolitical volatility developing in 2026. The principal risks on Global Supply Chain and Macro-economic Outlook have been updated to reflect the potential fallout from the conflict in the Middle East that could impact the Group, such as the availability and increases in the cost of goods for resale, and the impact of higher inflation on consumers and costs in the UK. The Group continues to monitor the situation closely, particularly regarding the Group's global allocation of supply, consumer demand and fuel prices.

One new principal risk has been recognised to reflect the heightened threat from competition and the potential impact on turnover and profit in the short to medium term. Mitigating actions to generate incremental sales and profit are being developed and deployed. The Board has focused the principal risk of developing and delivering the Group's strategy onto delivery to ensure that projects are effectively executed under the revised strategy. Additional capability and resource has been brought in to support the successful implementation of the new ERP. Finally, the principal risk for Artificial Intelligence (AI) has been refreshed to recognise the continual development in the use of AI in PPC (pay per click) and search.

The Board believes that the other principal risks remain largely as documented in the 2025 Annual Report, by nature and scale. These key risks and uncertainties include growth through mergers and acquisitions; aging systems; cyber security; quality and ethical sourcing; sustainability and climate change; health and safety.

Going concern

When considering the going concern assertion, the Board reviews several factors including a review of risks and uncertainties, the ability of the Group to meet its banking covenants and operate within its banking facilities based on current financial plans, along with a detailed review of more pessimistic trading scenarios that are deemed severe but plausible. The two downside scenarios modelled include a moderate decline and more severe decline in sales, both resulting in lower gross profit and worse profit and cash outcomes than the base scenario. The more severe downside scenario modelled this year was based on a prolonged period of macroeconomic stress in the UK, lasting for more than one year, with sales falling 10% year-on-year across the remainder of FY26 and then no growth year-on-year in FY27, in both our Topps Tiles brand and Pro Tiler Tools brand. The scenario also assumes declines in gross margins across the remainder of FY26 equating to a year-on-year decrease of approximately one percentage point, with recovery over a two-year period. The more severe downside scenario also incorporated elements of reverse stress testing to assess the level of sales decline required before the Group would begin to approach covenant breach. Even in this scenario the Group has a significant amount of cash headroom. This scenario also assumes that variable costs would reduce in line with sales and direct mitigating cost reduction actions, which would be taken if such a downturn occurred.

The going concern analysis, prepared for the Board, also outlined a range of additional mitigating actions that could be taken in a severe but plausible trading scenario. These included, but were not limited to, further savings on store colleague costs and central support costs, reduced marketing activity, a reduction of capital expenditure, management of working capital and suspension of the dividend. The Group's cash headroom and covenant compliance was reviewed against current lending facilities in both the base case and the severe but plausible downside scenarios. In no scenario modelled does the Group breach covenant compliance. The current lending facility, of £30.0 million, was refinanced in October 2022 and expires in October 2027.

In all scenarios, the Board has concluded that there is sufficient available liquidity, with sufficient covenant headroom for the Group to continue to meet all its financial commitments as they fall due for the foreseeable future, a period of not less than 12 months from the date of this report. Accordingly, the Board continues to adopt the going concern basis in preparing the Interim Accounts.

Responsibility Statement

We confirm that to the best of our knowledge:

(a) the condensed set of financial statements has been prepared in accordance with IAS 34 'Interim Financial Reporting' as contained in UK-adopted IFRS;

(b) the interim management report includes a fair review of the information required by DTR 4.2.7R (indication of important events during the first six months and description of principal risks and uncertainties for the remaining six months of the year); and

(c) the interim management report includes a fair review of the information required by DTR 4.2.8R (disclosure of related parties' transactions and changes therein).

There were no items of other comprehensive income in the current or preceding financial periods and therefore a separate Condensed Consolidated Statement of Comprehensive Income has not been presented.

Condensed Consolidated Statement of Changes in Equity

For the 26 weeks ended 28 March 2026

Condensed Consolidated Statement of Changes in Equity (continued)

For the 26 weeks ended 29 March 2025

Condensed Consolidated Statement of Changes in Equity (continued)

For the 52 weeks ended 27 September 2025

1. General information

The interim report was approved by the Board on 19 May 2026. The financial information for the 52 week period ended 27 September 2025 has been based on information in the audited financial statements for that period.

The comparative figures for the 52 week period ended 27 September 2025 are an abridged version of the Group's full financial statements and, together with other financial information contained in these interim results, do not constitute statutory financial statements of the Group as defined in section 434 of the Companies Act 2006. A copy of the statutory accounts for that 52 week period has been delivered to the Registrar of Companies. The auditor has reported on those accounts: their report was unqualified, did not draw attention to any matters by way of emphasis and did not contain a statement under s498 (2) or (3) of the Companies Act 2006.

This condensed set of consolidated financial statements has been prepared for the 26 weeks ended 28 March 2026 and the comparative period has been prepared for the 26 weeks ended 29 March 2025.

The interim financial statements have not been audited or reviewed by auditors pursuant to the Auditing Practices Board guidance on "Review of interim financial information" and do not include all the information required for full annual financial statements.

Basis of preparation and accounting policies

The financial statements of Topps Tiles Plc have been prepared in accordance with UK-adopted International Accounting Standards in conformity with the requirements of the Companies Act 2006 and the disclosure guidance and transparency rules sourcebook of the United Kingdom's Financial Conduct Authority. The unaudited condensed consolidated set of financial statements included in this half-yearly financial report has been prepared in accordance with International Accounting Standard 34 'Interim Financial Reporting', as adopted by UK-adopted International Accounting Standards and in conformity with the requirements of the Companies Act 2006. The same accounting policies, presentation and methods of computation are followed in the condensed set of financial statements as applied in the Group's latest annual audited financial statements. 

New and amended standards adopted by the Group

The Group continues to monitor the potential impact of other new standards and interpretations which have been or may be endorsed and require adoption by the Group in future reporting periods.

Going concern

When considering the going concern assertion, the Board reviews several factors including a review of risks and uncertainties, the ability of the Group to meet its banking covenants and operate within its banking facilities based on current financial plans, along with a detailed review of more pessimistic trading scenarios that are deemed severe but plausible. The two downside scenarios modelled include a moderate decline and more severe decline in sales, both resulting in lower gross profit and worse profit and cash outcomes than the base scenario. The more severe downside scenario modelled this year was based on a prolonged period of macroeconomic stress in the UK, lasting for more than one year, with sales falling 10% year-on-year across the remainder of FY26 and then no growth year-on-year in FY27, in both our Topps Tiles brand and Pro Tiler Tools brand. The scenario also assumes declines in gross margins across the remainder of FY26 equating to a year-on-year decrease of approximately one percentage point, with recovery over a two-year period. The more severe downside scenario also incorporated elements of reverse stress testing to assess the level of sales decline required before the Group would begin to approach covenant breach. Even in this scenario the Group has a significant amount of cash headroom. This scenario also assumes that variable costs would reduce in line with sales and direct mitigating cost reduction actions, which would be taken if such a downturn occurred.

The going concern analysis, prepared for the Board, also outlined a range of additional mitigating actions that could be taken in a severe but plausible trading scenario. These included, but were not limited to, further savings on store colleague costs and central support costs, reduced marketing activity, a reduction of capital expenditure, management of working capital and suspension of the dividend. The Group's cash headroom and covenant compliance was reviewed against current lending facilities in both the base case and the severe but plausible downside scenarios. In no scenario modelled does the Group breach covenant compliance. The current lending facility, of £30.0 million, was refinanced in October 2022 and expires in October 2027.

In all scenarios, the Board has concluded that there is sufficient available liquidity, with sufficient covenant headroom for the Group to continue to meet all its financial commitments as they fall due for the foreseeable future, a period of not less than 12 months from the date of this report. Accordingly, the Board continues to adopt the going concern basis in preparing the Interim Accounts.

2. Business segments

The Group trades in four related sectors, which are Topps Tiles, Parkside, CTD and Online Pure Play. The Board receives monthly financial information at this level and uses this information to monitor performance, allocate resources and make operational decisions. The Group sells tiles and tile-associated products in each of these sectors, predominantly to UK-based retail, trade and commercial customers, and offers a range of delivery and collection options for orders.

Revenue can be split by the following geographical regions:

3. Taxation

4. Interim dividend

An interim dividend of 1.00p (2025: 0.80p) per ordinary share has been declared. A final dividend of 2.10p per ordinary share was approved and paid in the period, in relation to the 52-week period ended 27 September 2025.

5. Earnings per share

The calculation of earnings per share is based on the earnings for the financial period attributable to equity shareholders and the weighted average number of ordinary shares.