Retailers reveal relief from tough trading

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FLOORING retailers Carpetright and Topps Tiles both reported a boost in trading yesterday, signalling a break from the tough conditions experienced as a result of the housing market slump.

Shares in Carpetright leapt almost 16 per cent after the firm revealed it had reversed a decline in sales, while Topps Tiles said it had slowed the drop-off in revenue and is on track to meet City expectations for the full year.

The upbeat reports echo a string of positive trading updates from the UK high street – from home improvements group Kingfisher, owner of B&Q, and fashion retailer Next to supermarket chain Morrisons. Meanwhile, a report from Nationwide yesterday revealed a small increase in consumer confidence in July.

Carpetright's UK and Ireland stores rose 1.4 per cent in the 13 weeks to 1 August on a like-for-like basis, against a 13.5 per cent slump suffered in the year to May.

Chairman Lord Philip Harris said that he felt "very encouraged about the future" for the first time in two years.

In June, the firm posted a 72 per cent slump in full-year profit and slashed its dividend.

Harris added: "We have continued to perform well in a tough trading environment and the sales achieved in the first quarter have provided an encouraging start to the financial year."

He said Carpetright would benefit in the second-half from an improving trend for mortgage approvals and last month's administration of Allied Carpets – the UK's second-largest floorings retailer which is to close 145 stores.

In its European operations, where it has stores in The Netherlands, Belgium and Poland, Carpetright reported a 2.8 per cent decline in like-for-like sales over the period.

Topps Tiles, which sells flooring as well as kitchen and bathroom tiles, said its year-end figures were likely to meet analysts' consensus expectations of about 13 million. It reported that like-for-like revenues were down 10.9 per cent against 11.9 per cent in the first seven weeks of the financial year to 1 August.

Finance director Rob Parker warned it was too early to herald a recovery, but said: "Things have stopped looking down, there's quite a bit of evidence that things are levelling out."

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