REG - Topps Tiles - Q3 Trading Update

Topps TilesAnnouncement

05/07/2023 07:00

For best results when printing this announcement, please click on link below:
http://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20230705:nRSE9702Ea&default-theme=true

RNS Number : 9702E  Topps Tiles PLC  05 July 2023

 

5 July 2023

Topps Tiles Plc

 

Q3 Trading Update

 

 

Topps Tiles Plc ("Topps Group", or the "Group"), the UK's leading tile
specialist, announces a trading update for the 39-week period ended 1 July
2023.

 

Group

 

Group sales remained strong in the third quarter, with total sales growth of
4.4% against last year.  The comparative period in Q3 2022 included a full
contribution from Pro Tiler Tools following its acquisition in March 2022. For
the year-to-date 39-week period, total sales growth was 7.6% year on year.

 

Omnichannel - Topps Tiles

 

The robust sales performance from Topps Tiles continued into the third
quarter. Like-for-like sales(1) were 2.5% higher year on year in the quarter,
and 3.7% higher on a year-to-date basis.

 

As expected, gross margins in Topps Tiles continued to improve sequentially
quarter on quarter, as inflationary pressures on cost of goods and shipping
costs reduce. Operating costs and profits remain in line with our
expectations.

 

Customer satisfaction remains at world class levels and recruitment and supply
chain pressures continue to reduce over time.

 

Online Pure Play - Pro Tiler Tools and Tile Warehouse

 

The sales performance within the Online Pure Play brands remains excellent,
with sales growth in excess of 60% in the third quarter, led by Pro Tiler
Tools.

 

Commercial - Parkside

 

As announced in the Interim Results, following a period of weaker trading, a
business improvement plan was launched in Parkside in the period. A
significant cost reduction plan is now complete, resulting in an annualised
reduction in operating expenses of £1.4 million. The cost of implementation
was approximately £0.4 million, which will be treated as an adjusting item at
year end. As a result of this change, we believe Parkside is now right sized
for current market conditions.

 

The Group remains well positioned for future growth in the important B2B
market, which is almost as large as the domestic RMI market, through Parkside,
Pro Tiler Tools and the dedicated contracts team in Topps Tiles.

 

Summary

 

Trading in the third quarter saw a continuation of the good performance
reported for the first half.  We remain confident that adjusted profit before
tax in the second half will be materially higher than the first half, and that
we will perform in line with market expectations(2) for the year as a whole.

 

The Group's growth strategy, strong brands and world class customer service,
underpinned by our strong balance sheet, give us confidence that we will
continue to take market share and deliver our goal of '1 in 5 by 2025(')(3)
ahead of schedule.

 

Rob Parker, CEO, said: "As we celebrate our 60(th) anniversary, we are pleased
to be reporting a continued robust performance in the third quarter, led by
Topps Tiles and Pro Tiler Tools, and the successful implementation of a
business improvement plan at Parkside.

 

"Looking ahead, we are confident that our core strengths of leading brands,
world class customer service, specialist expertise and a strong balance sheet
will enable us to continue to deliver value for all stakeholders."

 

(1) Topps Tiles like-for-like sales is defined as online sales and sales from
Topps Tiles stores that have been trading for more than 52 weeks.

(2) Current market expectations for FY23 as of 4 July 2023 are a range of
£11.3 million to £12.3 million of adjusted profit before tax, with a
consensus of £11.8 million.

(3) Refers to Topps' goal of accounting for £1 in every £5 spent on tiles
and associated products in the UK by 2025, thereby increasing its market share
to 20% from approximately 17% in 2019.  In the 52 weeks ended 1 October 2022
the Group's market share increased to 19.0% (2021: 17.6%).

 

For further information please contact:

 

 Topps Tiles Plc
 Rob Parker, CEO         0116 282 8000

 Stephen Hopson, CFO
 Citigate Dewe Rogerson
 Kevin Smith             020 7638 9571

 Ellen Wilton

 

Notes to Editors

 

Topps Tiles Plc is the UK's largest specialist supplier of tiles and
associated products, targeting the UK domestic refurbishment and commercial
markets and serving homeowners, trade customers, architects, designers and
contractors from 304 nationwide Topps Tiles stores, a commercial showroom in
London and seven websites: www.toppstiles.co.uk (http://www.toppstiles.co.uk)
, www.parkside.co.uk (http://www.parkside.co.uk) , www.protilertools.co.uk
(http://www.protilertools.co.uk) , www.northantstools.co.uk
(http://www.northantstools.co.uk) , www.premiumtiletrim.co.uk
(http://www.premiumtiletrim.co.uk) , www.warmfloorstore.co.uk
(http://www.warmfloorstore.co.uk) and www.tilewarehouse.co.uk
(http://www.tilewarehouse.co.uk) .

 

Since opening its first store in 1963, Topps has maintained a simple operating
philosophy ‐ inspiring customers with unrivalled product choice and
providing exceptional levels of customer service.  For further information on
the Group, please visit http://www.toppstilesplc.com/
(http://www.toppstilesplc.com/)

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact
rns@lseg.com (mailto:rns@lseg.com)
 or visit
www.rns.com (http://www.rns.com/)
.

RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our
Privacy Policy (https://www.lseg.com/privacy-and-cookie-policy)
.   END  TSTUPUUCMUPWGQC