Carpetright‘s full year results have revealed dive-bombing profits as the weak pound and a portfolio review plague margins.
For the year to April 29 the carpet specialist posted a pre-tax profit drop of 93 per cent to just £900,000, compared to last year‘s £12.8 million.
The cost of closing loss making stores contributed largely to the dramatic decline, coming in at a total cost of £13.5 million, further hindered by a 2.6 drop in UK sales to £381 million.
Elsewhere its European arm’s sales remained flat, positing revenues of £457.6 million.
Underlying pre-tax profits for the period dropped 21.3 per cent to £14.4 million, comfortably meeting analyst expectations.
Despite heavy losses, the retailer remains optimistic about its future and progress of its turnaround strategy, which has seen it pile cash into a store and brand revamps.
“I am pleased to report on a year of significant strategic progress, as we implemented a wide-ranging programme of investment and operational change, to refresh and update the Carpetright brand,” chief executive Wilf Walsh said.
“While a challenging consumer environment and competitive landscape remain headwinds, we are confident the additional potential in our self-help initiatives will support an increase in market share.”
“Our strategy is on track and the positive response we have received from these initiatives has encouraged us to press ahead with plans to complete the refurbishment of the UK store estate by the end of 2018 and to extend the programme in the rest of Europe.
“We have made an encouraging start to the new financial year, underpinned by the improving performance of our refurbished UK estate.”