Carpetright says market tougher as shares tumble
Firm regarded as useful economic indicator as it has been ‘first in, first out’ of recession
Carpetright’s fortunes are tied to the strength of the UK housing market and the firm is a useful economic indicator.
Carpetright forecast full-year profit at the lower end of market expectations on Tuesday as quarterly sales growth slowed at the retailer, adding to evidence of deteriorating consumer confidence in its home market in Britain.
Carpetright said sales at UK stores open over a year rose 1.4 per cent in the 12 weeks to April 22nd – slowing from third-quarter growth of 1.9 per cent.
“In common with other retailers in the home improvement sector in the UK we have experienced tougher trading conditions over the last three months,” said chief executive Wilf Walsh.
“While we remain confident in our turnaround plan, the level of sales growth in our final quarter leads us to expect that full-year profits will be towards the lower end of the current range.”
Shares in Carpetright were down 10 per cent in early trade.
Analysts’ forecasts for underlying pretax profit for the year to April 29th range from £13.9 million to £16.2 million (€16.3 million to €19.1 million), down from £17.3 million a year earlier.
Carpetright’s fortunes are tied to the strength of the UK housing market and the firm is regarded as a useful economic indicator as traditionally it has been “first in, first out” of a recession.
British retail sales posted their biggest quarterly fall in seven years in the first three months of 2017, hurt by rising prices since last year’s Brexit vote.