Tile specialist Topps Tiles Plc has reported a decline in sales as losses surpassed £15m.
According to its unaudited consolidated annual financial results for the 52 weeks ended 28 September 2024, total group sales were down 4.1% to £251.8m from £262.7m in 2023.
Pre-tax losses stood at £16.2m, down from a profit of £6.8m recorded the previous year.
“2024 has been a challenging year for the UK tile industry and many businesses facing into the wider RMI (repairs, maintenance and improvement) sector,” Topps said. “Following a period of strong growth during the two years after the pandemic, market activity started to decline in 2023 and this momentum accelerated in 2024.
“We estimate that the tile market this year will be approximately 20% smaller than in the pre-pandemic period (2019), whereas Group revenue is up 14.9% since 2019.
“Following three consecutive years of record sales between 2021 and 2023, Topps Group was inevitably impacted by the substantially weaker customer demand this year and saw adjusted revenue decline 5.4% year on year, a substantial out-performance of an overall market which we estimate was down 10-15% year on year.
“Due to the operational gearing of the Group, adjusted profit before tax was £6.2 million lower year on year at £6.3 million. On a statutory basis, the Group reported a loss before tax of £16.2 million, following a significant impairment of right of use assets.
“In this difficult context, we believe that the strategic progress and financial results delivered by the Group this year represent a creditable outcome and position the business well for an upturn in the economy, as macroeconomic indicators improve.
“Highlights in the year include the acquisition of the CTD Tiles brand and selected assets, significant digital developments in Topps Tiles, the continuation of very strong performance in Pro Tiler (including the acquisition of the remaining share capital), moving Parkside into profit, progressing plans to strengthen our infrastructure and supply chain, and the launch of a major new goal for the Group – Mission 365.
“This exciting and ambitious new goal represents a material step up in sales and profits from this year’s result over the medium term, supported by a number of key strategic initiatives.”
As for current trading, group sales in the first eight weeks returned to growth, up 1.2% year on year, with Topps Tiles like-for-like sales down 0.4% year on year in the period.
Commenting on the results, Rob Parker, Chief Executive said: “2024 has been a challenging year for RMI and especially bigger ticket spend. In the tile market, volumes remain well below pre-pandemic levels. Whilst Topps Group is not immune to these pressures, our growth strategy has served us well and we have continued to outperform the wider tile market.
“The start of the new financial year has seen a return to modest sales growth for the Group, helped by weaker prior year comparatives and the continued strength of our trade offer. Whilst pleasing, the forward macro indicators for our market remain mixed, in particular weaker consumer confidence, and we need to see a sustained improvement in these metrics before we can be confident of a consumer recovery.
“’Mission 365′, which sets ambitious revenue and profit medium-term goals, has focused the business around key areas of growth and we have delivered good progress against these over the second half – notably our trade digital offer, our plans to significantly expand our addressable market into hard surface coverings, trade business to business opportunities with the acquisition of CTD Tiles and the strong growth in online pureplay.
“The robust strategic progress being made now to position the business for the future leaves us well-placed for a recovery in market volumes and underpins our confidence in the medium term outlook.”
