Topps Tiles experiences a significant financial setback due to reduced market activity, with volumes falling short of pre-pandemic figures.
- The company reports a pre-tax loss of £16.2 million for the year ending September 28, contrasting a profit of £6.8 million previously.
- An adjusted profit metric indicates a decrease to £6.3 million, half of the previous year’s achievement, blamed on non-cash impairments.
- Revenue from group sales fell by 4.1%, impacted by a notable 9.1% drop in like-for-like sales at Topps.
- Despite challenges, sales to trade customers have been robust, increasing their share of revenue from 59.6% to 62.8% year-over-year.
Topps Tiles has reported a significant decline in its financial performance for the fiscal year ending September 28, primarily driven by a market that has not yet rebounded to pre-pandemic volumes. The tile retailer announced a pre-tax loss of £16.2 million, reversing the previous year’s profit of £6.8 million. The company attributed much of this loss to a £19.4 million non-cash impairment charge, including costs related to acquiring the remaining shares in Pro Tiler.
On an adjusted basis, profits fell dramatically to £6.3 million, indicating a challenging trading environment. Group revenue saw a decrease of 4.1%, totaling £251.8 million. A significant factor in this decline was a 9.1% drop in like-for-like sales at Topps Tiles stores, reflecting conservative spending by consumers in a tough economic climate.
However, the company did see areas of resilience. Sales to trade customers showed strength, with their revenue contribution rising from 59.6% in 2023 to 62.8% in 2024. This increase highlights a shift in the customer base, which has partially cushioned the company against a more significant downturn.
Rob Parker, the CEO, remarked on the difficulties encountered throughout the year, highlighting pressures in the repairs, maintenance, and improvement sector. He noted that while the company is not immune to these challenges, it has managed to outperform the broader tile market, assisted by strategic growth initiatives and a strong trade offer.
Looking forward, the commencement of the new fiscal year has brought a slight uplift in sales, aided by favorable previous year comparisons. Yet, there remains caution regarding the broader economic outlook, especially concerning consumer confidence, which remains fragile. Parker expressed optimism regarding the company’s Mission 365 strategy, which focuses on achieving medium-term revenue and profit growth goals.
He stated that the strategic progress achieved positions the company well for a potential recovery in market volumes, reinforcing confidence in the medium-term business prospects.
Topps Tiles remains cautiously optimistic about the future despite current market challenges.
