April 4, 2018 / 6:43 AM / a year ago

Topps Tiles second quarter sales dip on colder weather, softer market

(Reuters) - British flooring retailer Topps Tiles (TPT.L) said comparable sales in the second quarter were down 2.2 percent, dragged by a weaker underlying market and the impact of adverse weather in the two months through March.

Trading in the second quarter has seen a slowdown from levels reported in the first, the tile supplier said on Wednesday as it reported a 0.6 percent increase in comparable sales for the 26 weeks to March 31.

The company blamed short-term weather factors in late February and March and the timing of an earlier Easter for an around 1.6 percent reduction in second-quarter like-for-like sales.

The retailer, which targets the domestic refurbishment market in Britain, often tracks the wider health of the housing market and can struggle when consumers decide not to move home or splash out on home improvements.

Britain’s housing market slowed in February as lenders approved fewer mortgages than expected, Bank of England figures showed on Thursday.

This pressure is compounded by the slowdown in discretionary spending by Britons as rising inflation and stagnant wage growth leaves them with lesser spare cash than before.

“We are retaining a cautious view of market conditions for the remainder of the year,” Topps Tiles Chief Executive Matthew Williams said in a statement.

The group opened five and closed three stores during the first half.

Nonetheless, total revenues for the 26-week period rose 2.62 percent to 109.4 million pounds.

However, analysts at Liberum downgraded their pretax profit forecast for 2018 to 2020 by 8 percent saying Wednesday’s statement from Topps Tiles shows that market conditions toughened during the second quarter.

(The story was refiled to correct the spelling in the advisory)

Reporting by Rahul B in Bengaluru; Editing by Sunil Nair

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