3
April 2024
Topps Tiles
Plc
First Half Trading
Update
Topps Tiles Plc ("Topps Group", or
the "Group"), the UK's leading tile specialist, announces a trading
update for the 26-week period ended 30 March 2024.
Total Group sales in the first half
were £122.6 million1, down 5.9% year-on-year, against a
record revenue performance in 2023.
Subdued demand in the domestic
Repair, Maintenance and Improvement ("RMI")
sector, especially for bigger ticket projects, has persisted into
2024, resulting in lower footfall into Topps Tiles stores,
especially across the homeowner customer group. Trade
customers have once again proved more resilient, although trade
sales were also lower year-on-year. While conversion rates
grew year-on-year and the brand made further improvements to its
already world-class customer service scores (up 1.0 percentage
point year-on-year to 92.5% overall satisfaction), like-for-like
sales2 in Topps Tiles were 11.3% lower
year-on-year3 in the second quarter, driven by lower
footfall and volume. As expected, the gross margin percentage
in Topps Tiles was up year-on-year as cost of goods pressures
continued to ease, but net profits were impacted by lower volumes,
operating cost inflation and the impact of operational gearing,
despite strong cost control throughout the period.
Trading in the Online Pure Play
businesses remained strong, with good growth in Pro Tiler and
positive sales progress in Tile Warehouse, resulting in
year-on-year sales growth of 38.3%1 over the first
half. The Group will soon complete the acquisition of the
remaining 40% shareholding in Pro Tiler Limited, following the end
of the earn-out period, and is delighted that the co-founders will
be remaining with the business as we continue to invest in and grow
the brand.
Parkside continues to show a
significant year-on-year improvement in its financial performance.
Following the business improvement plan implemented last year, we
have achieved our short-term aim and expect the business to be at
breakeven over the first half, despite the difficult commercial
market.
Group profitability in the first
half of the year will be impacted by a number of factors including
the weaker market, the timing of the holiday pay accrual and
seasonally higher energy usage in the period. We continue to expect
the Group's profits in 2024 to be weighted towards the second half
as indicated in our Q1 trading update.
With its market leading brands,
specialist expertise and world-class service, the Group is well
positioned to benefit from a cyclical recovery in the RMI market.
The business remains in a strong financial position, with a robust
balance sheet, and is focused on maximising market opportunities
and emerging in a stronger competitive position as the market
improves. The Group plans to discuss its new goal and future profit
growth opportunities at the Interim Results on 21 May
2024.
Notes:
1 All revenue numbers are
stated before accounting adjustments including revenue recognition
and customer returns provisions which will be included in the
Interim Results.
2 Topps Tiles like-for-like
sales is defined as online sales and sales from Topps Tiles stores
that have been trading for more than 52 weeks.
3 Topps Tiles like-for-like
sales in the second quarter were negatively impacted by
approximately 80 basis points due to the the first week of the
Easter holidays falling into the period, which is a quieter time
for the business with lower trade sales. Last year, both
weeks of Easter were in the second half of the Group's financial
year.
For further information please
contact:
|
Topps Tiles Plc
|
|
|
Rob Parker, CEO
Stephen Hopson, CFO
|
0116 282
8000
|
|
Citigate Dewe Rogerson
|
|
|
Kevin Smith
Ellen Wilton
|
020 7638
9571
|
Notes to Editors
Topps Tiles Plc is the UK's largest
specialist supplier of tiles and associated products, targeting the
UK domestic and commercial markets and serving homeowners, trade
customers, architects, designers and contractors from 304
nationwide Topps Tiles stores, a commercial showroom in London and
eight customer-facing websites: www.toppstiles.co.uk,
www.parkside.co.uk,
www.protilertools.co.uk,
www.northantstools.co.uk,
www.premiumtiletrim.co.uk,
www.warmfloorstore.co.uk
www.flooringmaterials.co.uk
and www.tilewarehouse.co.uk.
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 on the Group,
please visit www.toppsgroup.com