Topps Tiles has reported a slowdown in sales growth at the start of its financial year, alongside the acquisition of the brand of collapsed rival Fired Earth. Shares in the Leicestershire-based retailer dipped in early trading on Tuesday despite a return to profitability.
Group sales, excluding the CTD brand purchased last year, rose 3.3% in the nine weeks since the end of September, with like-for-like sales up 2% across Topps. This marks a deceleration from the 5.3% like-for-like growth recorded in the full year to September 27. The company attributed the moderation to weaker consumer confidence, partly influenced by tax increases announced in the autumn Budget.
Incoming chief executive Alex Jensen described the results as “very encouraging”. Topps also revealed it had acquired the Fired Earth brand, intellectual property, website and approximately £2.5 million worth of stock for about £3 million. Fired Earth entered administration in October, leading to the closure of its 20 UK showrooms and 133 job losses.
The purchase follows Topps’ acquisition of CTD Tiles from administration last year for £9 million. After an investigation by the Competition and Markets Authority (CMA), Topps was required to sell off some stores, leaving 22 CTD locations. The CTD business was loss-making last year due to costs from the CMA probe, but is on track to deliver a profit in the new financial year.
Topps reported a statutory pre-tax profit of £8.3 million for the year to September, compared with a pre-tax loss of £16.2 million a year earlier.
