Mortgage drought his carpet group's sales

CARPETRIGHT chief executive Lord Harris has blamed a continued lack of affordable mortgage lending for worsening sales at his high street flooring chain.

Shares in Carpetright slipped 7.3 per cent yesterday after Harris revealed like-for-like sales in the UK and Ireland fell 7.3 per cent in the 12 weeks to 23 October, down from a 3.4 per cent drop at the end of July.

Retail analysts warned the firm's full-year profits could be as much as 13 per cent lower this year as consumer uncertainty continues to dog "big ticket" retailers which sell items such as carpets and washing machines.

Matthew McEachran, an analyst at Singer Capital Markets, warned the results were particularly alarming as October is normally the month when shoppers purchase new carpets in preparation for the Christmas season.

"Typically October is a key month for the group as consumers look to replace carpets ahead of the Christmas period but this year low consumer confidence and low levels of mortgage approvals have impacted trade," McEachran said.

Nick Bubb, of Arden Partners, believes full-year figures could be as low as 24 million in 2011, down 15 per cent from 28.2m at the end of 2010. He described the update as "poor".

Harris, chairman of the firm, warned the tough trading conditions were likely to continue into next year: "The further reduction in mortgage approvals along with fragile consumer confidence has produced a difficult market. We expect these conditions to continue into 2011."