Tile and flooring retailer Topps Tiles Plc has reported a decline in sales but continues to outperform the market.
According to its latest trading update for the 52-week period ended 28 September 2024, total sales for the year, excluding revenues from the assets acquired from the administrators of CTD, were approximately £248m, a decline of 5.7% from the Group record high of £263m reported in the previous year and broadly in line with the year ending September 2022.
Group sales in the fourth quarter were 4.4% lower, a slight improvement on the trends seen across the rest of the year, largely reflecting the weaker comparatives from the end of FY23.
The trading environment remained “very challenging” across the whole year with continued weak demand in the domestic Repair, Maintenance and Improvement (RMI) sector, especially for bigger ticket projects. As previously announced, Topps believes that the market has declined by 10-15% year-on year, indicating that the Group has continued to outperform the wider market.
Like-for-like sales in Topps Tiles were 8.2% lower year-on-year in the fourth quarter with trading levels remaining stable. Like-for-like sales for the year were 9.1% lower year-on-year. Sales to trade customers have continued to be more resilient than sales to homeowners.
The remainder of our Group operations have performed significantly ahead of the market with this progress being driven by its Online Pure Play operations which are “continuing to grow robustly”.
In August 2024, Topps announced the acquisition of the CTD Tiles brand, certain assets, direct selling teams and 30 stores for £9m. Following receipt of an initial information request from the Competition and Markets Authority, the CMA has informed the retailer that it intends to review the acquisition under UK merger control and the business is are now working with the CMA in connection with this process.
Furthermore, the CMA has now served an initial enforcement order under section 72(2) of the Enterprise Act 2002 (the IEO) on Topps Group in relation to the CTD Acquisition. An IEO is routinely applied in cases where the CMA reviews a completed transaction. It requires Topps Group and its subsidiary, Tiles4Less Limited, to, amongst other things, refrain from taking any further action to integrate the CTD Business into the Group and ensure that, except with the consent of the CMA, the CTD Business is carried on separately from the Topps Group business until the CMA review process has concluded. The Group said it is “actively working with the CMA to ensure compliance with the IEO”.
Rob Parker, Topps Group CEO, said: “We remain focused on the delivery of our new Mission 365 goal. In a year that has proved challenging in many ways, I am pleased by how well our teams have responded to the weaker market, demonstrating both our resilience and our ability to continue to outperform. I am also satisfied that despite these challenges we have been able to continue to deliver against our strategy and take opportunities as they have arisen, supported by our strong balance sheet.
“Looking ahead, macro-economic indicators point to a stronger market in 2025. While the timing and trajectory of the recovery remains hard to predict, we are confident that our clearly articulated and proven strategy will enable the further development of the Group in all market conditions.”
