- Carpetright like-for-likes fall 2.9% during its first half
- Retailer warns fall in the value of sterling will dent margins
- But full-year profit expectations remain unchanged
Carpetright has posted a drop in like-for-likes during its first half and warned that the fall in the value of the sterling will dent margins.
The floor coverings specialist suffered a 2.9% fall in like-for-like sales during the 25 weeks ending October 22, the retailer revealed in a trading update this morning.
It said full-year guidance of a decline in gross profit percentage had been revised to between 150 and 200 basis points, as a result of the plummeting pound and competitive market conditions.
However, Carpetright, which sources about 60% of its products from outside of the UK, said full-year profit expectations remain unchanged.
Carpetright is pressing ahead with plans to roll out its new brand identity across the UK and said 49 stores were now trading under the new-look fascia.
The retailer aims to refurbish 100 stores by the end of its current financial year.
It said shops operating with the fresh look were “delivering sales growth above comparable stores” across the rest of the business.
The retailer also hailed growth within its European business, which it said was “a little ahead of expectations”.
Its stores in the Republic of Ireland Netherlands and Belgium enjoyed a 0.9% uplift in like-for-like sales on a local currency basis.
In contrast to its core British business, Carpetright expects its European operations to deliver an increase in gross profit percentage of between 100 and 150 basis points, as previously forecast.
Carpetright boss Wilf Walsh said trading conditions in the UK reflected “variable consumer demand and increased competitive pressures”.
He added: “As we enter the second half, we are looking forward to implementing the next phase of our refurbishment and rebranding programme as we continue our drive to update and revitalise the business.
“With the benefit of recent UK investment expected to flow through as the second half progresses, further significant refurbishment work already underway and a continued improvement in the rest of Europe, our guidance for the year as a whole remains unchanged.”
Carpetright posts its interim results on December 13.