Carpetright reported a solid set of results this morning, with like-for-like sales up 7.5% in the UK. Here is analysts had to say.

The retailer has reported a strong set of results for the third quarter of the year

Freddie George, Cantor Fitzgerald

“After a recent meeting with the company, it is clear management has properly identified the problems of the business – the poorly perceived service, the dated look of the fascia, the concept being too focused on price and not aspirational enough for mainstream customer needs.

“Although the strategy to restructure the business is still ‘work in progress’, we believe management will come up with a credible strategy. We also believe it will better exploit the company’s dominant market positioning in carpet retailing (25% estimated market share).”

John Stevenson, Peel Hunt

“The turnaround in performance has been helped by direct management action to reposition the offer, with profit performance also helped by cost control. Recovery is showing traction, although there remains much to be done.

“Carpetright has performed well against the backdrop of a healthy home furnishings market. While the improvement in trading is encouraging, many of the strategic goals have yet to be fully realised, including the potential to drive rent reductions from a space review, the testing of a new small-store format and a general revitalisation of ranges, store environment and the brand as a whole.

A combination of rising consumer spending power, relatively undemanding ongoing forecast assumptions and the early stages of implementing a root and branch review of the business adds credibility to medium-term recovery prospects at Carpetright.”

Greg Bromley, Conlumino

The retailer is looking to retain its core value heritage, while simultaneously aiming to attract more affluent consumers from premium rivals such as John Lewis.

“The retailer states its promotional activity over this period was effective, while the introduction of an interest-free credit offer from Boxing Day helped to bolster like-for-like performance.

“Credit offers have become increasingly popular among big-ticket furniture and flooring retailers over recent years, encouraging consumers to purchase and pay later or pay in chunks.

“While this may boost sales figures in the short term, we do not believe this to be a sustainable and sensible strategy to rely on in the long term, with it possibly leaving the retailer with cash flow problems and unpaid balance issues in the future.”

Clive Black, Shore Capital

“Following this encouraging update, which further underscores our warmth to the strategy under implementation, Carpetright ‎states that it is on-track to meet full-year market expectations.

“Accordingly, it is not our expectation that there will be material changes to forecasts following this update. That said such strong like-for-like sales is notable and is likely to help sustain the improved sentiment and upward momentum of Carpetright’s shares to our minds.”

Carpetright trading improves in Q3 after new Boxing Day promotions