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The Markets
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Coverage of London’s small caps continues on proactiveinvestors.com
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The Markets
by Proactive
Proactive UK has moved.
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The Markets
by Proactive
Proactive UK has moved.
Small-cap coverage continues on .com
Go to Proactive UK

Retail

Carpetright shares dive as falling consumer confidence hammers sales

Shares crashed 43% as the carpet group warns of a post-Christmas slump

Carpetright PLC (LON:CPR) has issued yet another profit warning as trading over Christmas turned out significantly worse than expected.

The floorings and carpet retailer said UK sales especially were weak in the eleven weeks to January 11, which will reduce profits this year to between £2-6mln.

READ: Brexit could hamper turnaround of Carpetright and other UK retailers, says Deutsche Bank

In December, the retail chain had forecast a profit of between £13.8mln to £16.7mln.

UK trading was hit by lower customer footfall, with transaction numbers down significantly year-on-year

Like-for-like sales in the UK fell by 3.6%, with falls of 1.4% in flooring and an even steeper decline in bed sales.

After Christmas, the sales decline accelerated to 7.1%.

READ: Carpetright slumps as it lowers forecasts after first half profits fall

European sales were better with a 4.3% rise like-for-like, though margins tumbled by between 4-6 percentage points.

Wilf Walsh, chief executive, said falling consumer confidence was behind the post-Christmas slump.

"The severity of the decline in footfall over this key trading period and our more cautious view of the outlook for the balance of the year leads to a significant reduction in our full year expectations.

Neil Wilson, senior market analyst at ETX Capital Markets, said the statement was a shocker.

The 7.1% fall in flooring sales since Christmas was a terrible performance in a key period for the group, he added.

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