Topps Tiles earnings fall despite outperforming market in first half

(Alliance News) - Topps Tiles PLC on Tuesday said it outperformed the market, despite reporting lower earnings for the first half of the financial year.

The Leicestershire, England-based tile retailer said pretax profit sank 75% to GBP474,000 in the half-year to March 28 from GBP1.9 million a year prior.

Revenue edged down 0.2% to GBP142.6 million from GBP142.9 million, but was up 12% on an adjusted basis.

Distribution and selling costs grew 4.1% to GBP50.5 million from GBP48.5 million, while the firm faced a GBP2.0 million property related impairment charge, swung from a GBP396,000 impairment reversal a year ago.

Adjusted pretax profit fell 31% to GBP2.2 million from GBP3.2 million.

Topps Tiles said its revenue performance was "robust" and ahead of the market, in a "challenging" environment.

The firm declared an interim dividend of 1.00 pence per share, up 2% from 0.80p a year ago.

"Topps remains a market outperformer despite a softer backdrop of weaker consumer sentiment, geopolitical uncertainty and the cumulative impact of cost inflation," said Chief Executive Alex Jensen.

"We are making good progress in delivering our strategic agenda, including a programme of self-help measures weighted towards the second half, and we are accelerating growth in digital, trade and category extensions. These actions are designed to support modest year-on-year profit growth and provide a stronger financial platform for 2027, positioning the group for long-term sustainable profit growth."

Topps said it continues to outperform a "softer" market in the second half. It said like-for-like revenue in the first seven weeks of the second half has returned to positive, up 0.6%.

The firm also noted "strong growth" in its online offering in the second half so far, including record revenue weeks in Pro Tiler.

Topps expects profit upside in the second half compared to the first, with "modest" on-year profit growth in line with market expectations.

Shares in Topps Tiles were down 0.3% at 33.89p on Tuesday morning in London.

By Michael Hennessey, Alliance News reporter

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