Topps Tiles PLC (LON:TPT) said it has made an “encouraging” start to the second half after profit and revenue dropped in the first six months of the year.
In the period ended March 30, pre-tax profit fell to £5.2mln from £6.4mln last year as trading losses of £1mln in the Parkside commercial tiles business dragged on the group’s performance.
Revenue edged down to £110.3mln from £110.5mln as the tiles retailer closed 10 stores to mitigate sluggish sales.
READ: Topps Tiles’ first-half profits set to beat forecasts as trading picks up in second quarter
On a like-for-like basis, sales increased 0.2%, helped by the later timing of Easter this year and the non-repeat of heavy snowfall and icy temperatures seen last year. However, the growth marked a slowdown on the 0.6% like-for-like rise in sales for the same period a year ago.
Topps Tiles maintained its interim dividend at 1.1p per share.
It cut its net debt to £18mln from £25.1mln last year and expects to end the year with borrowings in the range of £12mln to £14mln.
Resilient first-half performance
"The group has delivered a resilient first-half performance as we continue to consolidate our position as the UK's leading tile specialist,” said chief executive Matthew Williams.
“Against a consumer backdrop which remains challenging, our trading performance was robust, underpinned by further gains in market share.”
In April, Topps Tiles bought commercial tiles unit Strata Tiles for £3.3mln.
Williams said Strata is “highly complementary” to the Parkside business and the two brands provide the group with a “strong base for further expansion” into the commercial market.
'Encouraging start' to second half
In the first seven weeks of the second half, like-for-like sales have gained 1.2%, compared to a 0.2% decrease in the year-ago period.
"The group has made an encouraging start to the second half, with trading in the period to date continuing the positive trend seen in the second quarter,” Williams said.
“While we are retaining a prudent view of market conditions for the remainder of the year, we remain confident in our ability to continue to extend our market leading position."