Topps Tiles PLC (LON:TPT) tumbled as it warned profit before tax for the year to next October will be “materially below” expectations.
The market had forecast £13.5mln and £14.5mln, which was still below last year’s £16mln.
READ: Topps Tiles topples as election uncertainty dents sales in new financial year
The flooring specialist said the home improvement market still has to see post-election improvement, with like-for-like sales dropping 5.5% in the eight weeks to 22 February.
Chief executive Rob Parker said the positive impact seen in the housing sector “traditionally” lags for the retailer, which expects to see an uptick in the second half.
“We are taking appropriate action to ensure we remain competitive, to reduce costs and to strengthen cash flows,” Parker added.
Downgrade to 'hold'
The news prompted analysts at house broker Liberum to downgrade the stock to 'hold' from 'buy' and cut the target price to 65p from 85p.
Their forecast for full-year profit before tax is £7mln.
"While we have significantly lowered our numbers over the forecast horizon, the longer-term potential for the business remains – including the nascent commercial operations longer," analysts commented.
Shares tumbled 21% to 62p on Thursday morning.
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