United Carpets has reported at its Annual General Meeting this morning that trade is continuing in line with expectations, driven by its strategy to maximise revenues from existing stores and expand its franchise business.

The pipeline of new stores will continue across northern and central England at the retailer, which has 61 stores – 13 company owned and 48 franchises.

The retail environment remains challenging, but United Carpets maintains that its focus on quality, low-cost items has meant its business has not been hit too hard by interest rate rises and the volatility on the financial markets.

The floor coverings division remains the main driver of the group’s improved performance, supported by the beds division. In September, the group introduced an in-house cutting and distribution service, which it claims is beginning to benefit product offering and competitiveness.

Analyst Seymour Pierce said that current trading will have slowed from the phenomenal start to the year – up 20.9 per cent like for like – as comparatives get tougher and the pressure on consumer spend builds. It believes United Carpets is outperforming its peers, but the slowdown at Carpetright is indicative of the trend.

Seymour Pierce said the update was as expected and forecasts of£1.7 million for the year and£2.1 million for 2009 remain unchanged.