Topps Tiles delivers record revenues, remains cautious of trading headwinds

Retailer Topps Tiles said on Tuesday that it had delivered a record year in terms of revenues over the 53 weeks ended 2 October but also warned of continued trading headwinds from reduced consumer confidence, global supply chain challenges and cost inflation.

Topps Tiles stated that group revenues had grown 18.3% to £228.0m, helping the group return to the black with a pre-tax profit of £14.3m following a pre-tax loss of £9.8m in the prior year. Basic earnings per share were 5.59p, a marked improvement when measured against 2020's 4.11p loss per share.

The London-listed firm also highlighted that like-for-like retail sales were up 19.6%, despite trading restrictions throughout much of its second quarter, and that adjusted pre-tax profits had improved from £3.6m to £15.3m despite gross margins contracting modestly from 58.5% to 57.3% as a result of an increased investment into value and higher shipping costs.

Topps also reinstated its dividend based on 2x full-year adjusted earnings per share cover.

Looking forward, Topps said trading remained "robust", with a two-year retail like-for-like sales growth of 18.4% in the first eight weeks. However, the company did caution that continued trading headwinds from reduced consumer confidence, global supply chain challenges and cost inflation were still a consideration.

Chief executive Rob Parker said: "Despite significant disruption for a three-month period, during which our stores were unable to welcome homeowners, we delivered record revenues for the year and made good progress towards our '1 in 5 by 2025' market share goal.

"We believe this performance underlines the strength of our strategy and the success of new initiatives including the expansion of our value ranges and the introduction of innovative new products. The successful development of our digital offer during the year has been particularly pleasing and we have plans in place to expand this further in 2022."

As of 0910 GMT, Topps shares were down 2.40% at 61.10p.