// Topps Tiles half-year profits plummet despite delivering record sales
// The DIY retailer posted a 69.6% drop in pre-tax profits in the 26 weeks to 1 April
Topps Tiles has posted record half year sales but profits have more than halved due to the “impact of inflation on operating expenses”.
While group sales were up 9.3% to £130.3m, pre-tax profits for the DIY retailer plummeted 69.6% to £1.7m in the 26 weeks to 1 April. When adjusted, pre-tax profit was down 38% at £4.4m.
The retailer said the hit to its first half profitability “reflects the impact of inflation year on year, including significantly increased energy costs, and a number of other one offs”.
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The retailer posted a 4.3% like-for-like sales growth and an “exceptional performance” from its Pro Tiler Tools acquisition.
Topps Tiles said it expects profit in the second half to increase materially “driven by the growth of our new businesses, improving gross margins, as well as gas costs reducing and (£0.9m) holiday pay accruals reversing”.
Chief executive Rob Parker said: “As we mark our 60th anniversary, we are pleased to be reporting record first half revenue for the Topps Group, reflecting our successful development and diversification as we strengthen our position as the UK’s leading tile specialist.
“Our strong trading, when combined with our successful strategy, world class customer service, leading product offer and strong balance sheet, gives us increasing confidence in our outlook.
“We remain confident that we are on track to hit our 20% market share target ahead of schedule.”
Last week, the tiling specialist named Paul Forman as chair designate to take over from Darren Shapland as he nears the end of his tenure.
Earlier this year, Shapland survived a shareholder vote after investor MS Galleon ramped up calls for his removal as a “necessary step” for the business to return to growth.
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