Rainham, England, October 3, 2005--Carpetright, the UK's largest carpet retailer, warned yesterday that the consumer slowdown was continuing, after reporting a sharp slide in sales as customers reined in their spending on refitting new homes.
Like-for-like sales fell 7.5% in the 15 weeks from the end of April. Lord Harris of Peckham, the chairman and chief executive of Carpetright, said: "Trading in our UK and Republic of Ireland business has remained difficult due to a weak consumer environment combined with strong comparatives from last year."
About a fifth of the group's sales are from customers who are moving home, and the slump in the housing market has affected trading. All retailers have been experiencing a slowdown in business, with the British Retail Consortium recently reporting the poorest July in 10 years.
The collapse of the Allders department store chain has also hit Carpetright, causing a 2% drop in sales and profit after 21 Allders outlets in which it had a concession were closed. The company still trades from 26 former Allders stores, including those bought this year by its competitors, Debenhams and Bhs.
In contrast to the UK, Carpetright's European stores have seen better trading. Like-for-like sales at its Dutch and Belgian stores increased 6.3% over the period. It is hoping to double its market share in both countries to 6% over the next three years.
Carpetright's figures also contrast with its rival floorings business, Headlam, which said yesterday sales continued to be strong as it reported a 9% increase in pre-tax profits for the first half of 2005. Profits reached pounds 18.2m, with revenues lifted by a 3% increase in like-for-like sales. It said it was confident about its prospects for the rest of the year. Tony Brewer, the chief executive, said: 'We believe this result has outperformed market conditions and therefore, the group has continued to increase its market share.'
Carpets make up about 50% of Headlam's sales, while vinyl, wood and laminate flooring make up the remainder. It put its success down to its locally focused businesses, which helped it weather the difficulties in the retail sector.
