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Highlights

  • Topps Tiles posts adjusted first-half profit before tax of £3.2 million, beating forecasts.

  • Group sales rose 9.5% in early second-half trading, driven by the performance of key business units.

  • CEO transition remains underway, with an announcement expected later in the year.

Topps Tiles PLC (LSE:TPT) saw its shares rise by 4.4% following the release of its half-year financial results, which showed better-than-expected underlying profits and momentum going into the second half of the fiscal year.

For the 26-week period ending 29 March, the tile retailer reported an adjusted profit before tax of £3.2 million, representing a 3.2% increase compared to the same period last year. This figure outpaced analysts’ expectations, with house broker Peel Hunt having forecast a profit of £2.2 million.

However, the reported figure excludes a £1 million trading loss from the company’s acquisition of CTD, which has been treated as an adjusting item. Peel Hunt clarified that the core business performance, excluding CTD, remains in line with expectations.

Revenues from the underlying business also showed healthy growth. First-half revenue rose by 4.1% year-on-year to £127.8 million, excluding the impact of CTD. Within this, the company’s Pro Tiler business saw a 17.6% increase in sales, Tile Warehouse revenues doubled, and the core Topps Tiles segment reported a 2.2% gain.

The company also reported a strong start to the second half, with group sales up 9.5% in the first seven weeks. This growth trajectory supports Topps Tiles’ expectation of improved profitability for the full year.

Chief Executive Rob Parker, who announced his intention to step down earlier this year, commented on the outlook: “Based on current trading, we expect our full year profits to show a meaningful improvement over the prior year.” The search for Parker’s successor is ongoing, with the company anticipating a formal announcement during the second half of the year, alongside a “planned transition”.

Despite the interim performance, Peel Hunt has opted to keep its full-year forecasts unchanged at this stage.