Consumer caution hits Topps sales

Shares in the floor coverings specialist opened around six per cent lower after it said like-for-like sales were down 2.1 per cent in the past seven weeks, compared with an increase of 1.8 per cent over the six months to April 2.

While Topps said its performance was “not significantly” different from expectations, analysts warned low levels of housing transactions and consumer confidence remained a drag on short-term prospects.

Mark Photiades, a retail analyst at Singer Capital Markets, added: “April trading conditions were clearly tough given the warm dry weather and we suspect the DIY sheds may well have picked up some share in this period.”

He said he expected current market estimates for profits of £17.3m in the year to September to be lowered as a result of today’s guidance.

The sales update from Topps came as it reported adjusted profits of £7.2m for the 26 weeks to April 2, against £7.8m during the equivalent 27 week trading period a year earlier.

Chief executive Matt Williams said: “I consider this to have been a robust performance, in light of the prevailing economic conditions and in comparison to our sector peers.”

The company grew market share to 25.5 per cent from 24 per cent a year earlier and said it would continue its expansion by adding eight new stores during the current financial year. It ended the half year with 277 stores under the Topps Tiles brand and 36 trading as Tile Clearing House.

Mr Williams added that while like-for-like sales decreased 2.1 per cent in the first seven weeks of the second half, he said trading over the later part of the period offered cause for encouragement.