Headlam Regulatory News (HEAD)

18 July 2017

Headlam Group plc

('Headlam' or the 'Company')

Pre-Close Trading Update

Headlam Group plc (LSE: HEAD), Europe's largest distributor of floorcoverings, is pleased to provide a pre-close trading update ahead of announcing its interim results for the six months ended 30 June 2017 on Monday, 21 August 2017.

Total revenue for the six months ended 30 June 2017 increased by 4.0% to £341.9 million compared with the same period in the prior year. On a constant currency basis, total revenue increased by 2.6% to £337.2 million with both the UK and Continental Europe delivering growth, and total revenue for each of the residential and commercial sectors also showing a positive performance.

The UK accounted for 85.9% of total revenue (87.0% in constant currency) with like-for-like revenue* growth of 2.1% reflecting a positive performance from both the residential and commercial sectors, up 2.8% and 0.5% respectively.

Continental Europe, which accounted for 14.1% of total revenue (13.0% in constant currency), showed like-for-like revenue* growth of 3.0%. The residential sector delivered strong growth of 6.7% whilst the commercial sector declined by 0.5% as the positive performance from both the Dutch and French businesses was offset by the Swiss business.

Gross margin across the Company improved by 103 basis points to 31.06% compared with the same period in the prior year predominately as a consequence of the focus on more effective organisation and streamlining of the Company's businesses' practices.

The Company continues to trade in-line with the Board's expectations for the full year.

Further to the Company's announcement of 11 May 2017, the Company is pleased to confirm that Chris Payne will join the Company as Chief Financial Officer and Executive Director on 13 September 2017.

Analyst Meeting

A meeting for analysts will be held at 10.00am on the day of the interim results, 21 August 2017, at the offices of Buchanan, 107 Cheapside, London EC2V 6DN. Please contact Buchanan on 020 7466 5000 or email headlam@buchanan.uk.com

* Like-for-like revenue is calculated based on constant currency from activities and businesses that made a full contribution in both the 2017 and 2016 periods and is adjusted for any variances in working days

Enquiries:

Notes for Editors:

Headlam is Europe's largest distributor of floorcoverings having grown significantly via organic growth and acquisition since 1992.

Headlam provides the distribution link between suppliers and customers of floorcoverings, providing suppliers with the greatest coverage and customer penetration for their products across the UK and Continental Europe, and customers with the broadest range of products supported by next day delivery.

The Company is engaged with suppliers across 16 countries whose products cover a significant proportion of the floorcoverings market (including carpet, residential vinyl, wood, laminate, luxury vinyl tile, underlay and commercial flooring). The Company's customers are within the residential and commercial sectors and comprise principally independent retailers and flooring contractors.

The Company currently comprises 61 wholly-owned businesses in the UK and Continental Europe each operating under their own trade brand and utilising their individual sales team which achieves a greater reach into the customer base.

Each of the businesses is supported by the Company's centralised and financial resources and extensive distribution network across the UK and Continental Europe that comprises four distribution hubs, 18 distribution centres, 59 service centres / trade counters and a corporate showroom.