Ailing chain floored by ‘challenging’ conditions

FLOORING chain Carpetright are in talks with their banks after issuing a third profit warning in just four months.

The company also confirmed they were examining a “range of options” to speed up a turnaround and strengthen their balance sheet.

The unscheduled update triggered a 23 per cent slump in their share price.

It came 24 hours after a day of carnage on the high street, with Toys R Us and Maplin both going bust and restaurant chain Prezzo preparing to close one in three outlets.

Carpetright have been hit by falling consumer confidence and the weak housing market.

They said trading had “remained challenging” since they updated the market on January 19.

Sales in UK stores open at least a year had improved but were still Shares slumped after market update down year on year. Stores in Europe are doing better.

The country’s biggest flooring firm are gearing up for the important Easter period but warned trading was below expectations.

They are set to make a small loss for the year to the end of April as a result, bosses said.

Stockbroker Peel Hunt are forecasting a £4.3million profit, having previously predicted £3million. Carpetright described initial discussions with their lenders as “constructive”, saying they were currently “fully supportive”.

Other action to boost business “remains at an early stage”, they added.

Analyst Phil Carroll from Shore Capital called the update “disappointing but not surprising either”, with trading hit by the recent cold snap.

Carpetright sparked a shares crash earlier in the year when they warned over profits and said UK sales had fallen 3.6 per cent in the 11 weeks ending January 13.

The group have 416 stores in the UK and 552 worldwide.

Neil Wilson, senior market analyst at ETX Capital, said it was a “bad week for retail”. ● More than 55,000 shops in England face inflation-busting business rate rises in April, according to industry experts Altus Group. Oil Royal Mail RSA RBS J Sainsbury SSE Severn Trent Serco Sports Direct Shell Sky Smith & Nephew Smiths WH 550.0 618.0 265.7 256.5 1221.0 1723.5 88.8 363.4 2307.5 1372.0 1277.0 1979.0 -10.0 -0.4 -2.0 -2.5 -4.0 +16.0 -2.2 -4.0 -13.5 +24.0 +8.5 -49.0