Topps Tiles has suffered a fall in full-year profits as the business grappled with “challenging trading conditions”.
The tile specialist said pre-tax profits dropped 15% to £17m in the 52 weeks to September 30.
Adjusted pre-tax profit, which excludes one-off costs such as vacant property costs, fell 15.5% to £18.6m.
Like-for-like sales were down 2.9% across the year, although group revenues decreased at the slower rate of 1.5% to £211.8m.
Topps Tiles said gross margin slipped 80 bps to 61.1%.
During the period, Topps completed the £1.1m acquisition of Parkside Ceramics – a business specialising in the supply of tiles into the commercial sector.
Topps said the deal would form the basis of a new commercial division, in which it will invest around £1m in the coming year “to drive longer-term growth”.
The retailer said that trade sales now account for 55% of total revenue, with 55,000 traders now registered with its ‘Rewards +’ loyalty scheme – an increase of 35% year on year.
Topps opened a net 21 new stores during the period, taking its portfolio to 372 at the year end.
Boss Matthew Williams said the business “responded well to the more challenging trading conditions” it experienced during the year.
He hailed “good progress” with its strategy of “out-specialising the specialists” and said trading had improved during the first eight weeks of its current financial year, when like-for-likes grew 3.2%.
Williams said: “While we are retaining our prudent view of market conditions for the year ahead, we are encouraged by this return to like-for-like sales growth.
“We are confident that the combination of the significant further potential in our strategy of ‘out-specialising the specialists’ with our accelerated plan to grow in the commercial tile market will underpin our future success.”