29 Jul 2014 07:00
29 July 2014
Carpetright plc
Interim Management Statement
Carpetright plc, Europe's leading specialist carpet and floor coverings retailer, today announces an update on trading for the 13 weeks ended 26 July 2014.
Highlights
· UK
o Like-for-like sales (note 2) in the UK increased by 6.1%. Total sales increased by 5.2%.
o Reduction in gross profit percentage of 260 basis points in the period, with revised guidance of a decline for the full year of between 50 and 100 basis points.
o During the period, four stores were opened and nine closed giving a net reduction of five. There are now 467 stores trading, of which 283 have now been modernised.
· Rest of Europe
o In local currency terms, like-for-like sales in the Rest of Europe (Netherlands, Belgium and the Republic of Ireland) decreased by 3.6%. Total sales declined by 3.9%. After the impact of currency movements this translates to a 10.1% decrease in total sales.
o Increase in gross profit percentage in line with previous guidance of around 250 basis points for the full year.
· Wilf Walsh joined the Board as Chief Executive with effect from 21 July 2014, at which point Lord Harris became non-executive Chairman.
The UK business saw small but steady improvements in sales growth during May and June, with this trend accelerating significantly during July, assisted by weak comparatives in 2013 when sales were impacted by a prolonged period of hot weather. Over the period, gross profit margins have decreased by 260 basis points, a consequence of implementing market beating promotions.
Sales across our Rest of Europe business units have shown signs of improvement on the recent trend, with a reduction in the rate of decline. Gross profit margin was in line with previous guidance of an increase of around 250 basis points for the full year, resulting principally from improved sourcing and operational disciplines. On the back of this activity, it is encouraging to report that our businesses in the Netherlands and Belgium have returned to profit in the first quarter of the financial year.
Notwithstanding the continued tough trading conditions, our expectations for the current year are unchanged.
The Group will report its pre-close trading update for the first half of its financial year on 14 October 2014.
Analyst conference call
Carpetright will host a conference call for analysts at 08:30 BST today.
The dial in number is +44 (0) 20 3003 2666 with the passcode 'Carpetright'.
Thereafter, for further enquiries please contact:
Carpetright plc
Neil Page, Group Finance Director
Tel: 01708 802000
Citigate Dewe Rogerson
Kevin Smith / Jos Bieneman
Tel: 020 7638 9571
A copy of this trading statement will be available on our website www.carpetright.plc.uk today from 7.00am.
Notes
1. All sales figures are quoted after deducting VAT.
2. Like-for-like sales calculated as this year's net sales compared to last year's net sales for all stores that are at least 12 months old at the beginning of our financial year. Stores closed during the year are excluded from both years. No account is taken of changes to store size or introduction of third party concessions. Sales from insurance and house building contracts are supplied through the stores and included in their figures.
3. There have been no significant changes to the Group's financial position during the period.
Appendix 1: Group Sales
Current Financial Year | Previous Financial Year | ||
13 weeks to 26 July 2014 | 12 weeks to 20 July 2013 (previously reported) | 52 weeks to 28 April 2014 (previously reported) | |
UK | |||
- Total | 5.2% | (3.3%) | (1.5%) |
- Like-for-like | 6.1% | (1.9%) | (0.2%)
|
Rest of Europe | |||
- Total (in local ccy) | (3.9%) | (10.9%) | (8.6%) |
- Like-for-like (in local ccy) | (3.6%) | (10.6%) | (8.6%) |
- Total (in GBP)
| (10.1%) | (4.4%) | (5.4%) |
Group Sales (in GBP)
|
2.5% |
(3.5%) |
(2.2%) |
Appendix 2: Store portfolio
Current Financial Year | Previous Financial Year | |||||
Store portfolio | 26 July 2014 | 20 July 2013 (previously reported) | 28 April 2014 (previously reported) | |||
Stores | Sq ft | Stores | Sq ft | Stores | Sq ft | |
UK | ||||||
Standalone | 456 | 4,028 | 457 | 4,064 | 457 | 4,039 |
Concessions | 11 | 19 | 16 | 29 | 15 | 27 |
Total | 467 | 4,047 | 473 | 4,093 | 472 | 4,066 |
Europe | ||||||
Republic of Ireland | 22 | 162 | 21 | 155 | 22 | 162 |
Netherlands | 94 | 1,091 | 95 | 1,104 | 95 | 1,104 |
Belgium | 25 | 298 | 26 | 307 | 25 | 298 |
Total | 141 | 1,551 | 142 | 1,566 | 142 | 1,564 |
Total Group
|
608 |
5,598 |
615 |
5,659 |
614 |
5,630 |