Carpet and flooring specialist Carpetright has reported that profit before tax fell £1.2 million to £9.8 million in the 26 weeks to October 30th, in interim results published today.
Group revenue dropped £10 million to £248 million during the period, although the business was able to reduce net debt by £12.8 million to £58.5 million.
Chairman and CEO of Carpetright Lord Harris of Peckham said: “The economic and consumer environment remained challenging in the first half.
“Against this backdrop, the group continued to trade profitably and generate net cash.
“Whilst we remain cautious about the retail market in the balance of the financial year and throughout 2011, the board has confidence that the group is well positioned to deliver future sales growth when consumer demand in our sector improves.”
In its last official statement the company cited the continuing reduction in mortgage approvals and fragile consumer confidence in the UK and Ireland as the main reasons for sales dropping in the 12 weeks to the end of October.
This region represents Carpetright’s core market, where it now has 584 stores after opening 17 new outlets and closing 19 over the course of the six months.
Managing its store portfolio remains one of the five key strategies for the business in the second half, alongside consolidating its position as a market leader in floor coverings, developing a competitive bed proposition, expanding in continental Europe and reaching more customers through additional sales channels such as the internet.
Lord Harris added: “Although we have broad national coverage in the UK we know there are still opportunities to open profitable stores, particularly in densely populated areas.
“This is supported by recent analysis which demonstrated the catchment area for our existing stores is an average drive time of less than 15 minutes.
“During the last year we have opened many smaller, profitable high street stores - we expect to continue this activity in the second half.”