Overseas blues for Carpetright

The floorings retailer saw UK like-for-like sales bounce back with a 1.9 per cent rise in its third quarter to January 25, but said “extremely difficult economic conditions” in the Netherlands would leave it nursing losses in its overseas division.

Despite an expected increase in UK earnings over the full year, the Netherlands hit was now set to see overall profits for the year to April miss City forecasts of between £9m and £11m.

The alert marks its second since early October, when founder Lord Harris of Peckham also made a dramatic return to the helm after the shock departure of chief executive Darren Shapland.

Lord Harris, who was formerly non-executive chairman, also cautioned that trading in the UK remains volatile with high street conditions still tough.

He said: “In the UK, the pace of the recovery remains uncertain in the face of continuing sales volatility, but we are confident that our self-help measures have further potential.

“However, with a further weakening of the market in the Netherlands, we now expect underlying pre-tax profits for the full year will be below the lower end of the current range of market expectations.”

Carpetright’s UK sales rise comes after an 0.8 per cent fall in the half year and follows turnaround efforts. It pointed out that falling wholesale trade held back an even bigger improvement in the main retail division, which recorded a 2.5 per cent increase in like-for-like sales.