Company focuses on operating cost reductions
Like-for-like sales at wood and laminate flooring specialist Floors-2-Go plunged 18 per cent in the year to December 31 2005 as the slowing housing market rocked the retailer's results.

Sales fell 5.2 per cent to£74.4 million, operating profit dropped 26.4 per cent to£6 million and profit before tax was down 49.4 per cent, at£3.2 million.

Gross margin improved slightly to 49.8 per cent and staff costs were reduced 5.6 per cent in the second half of the year as the retailer focused on operational costs.

In current trading for the year to March 10 2006, total sales have decreased 9.7 per cent and like-for-like sales are down 15.8 per cent.

The company opened 28 stores, eight concessions closed in Texstyle World stores and two stores relocated. Floors-2-Go now trades from 137 stores and plans up to 15 store openings this year.

A new warehouse facility at Oldbury opened in April last year, giving the group the necessary capacity needed for its stated target of 300 to 350 stores.

More than 100 new product lines were introduced during the fourth quarter of last year as the company moved sales towards more expensive laminates and hardwood products.

'In response to these difficult conditions, the group targeted gross margin, which improved by 1.8 per cent following initiatives to introduce new ranges, improve terms with suppliers and increase sales of higher-margin accessories,' said chief executive Simon Farnsworth.