Topps Tiles hit by consumer squeeze

Topps Tiles, the specialist tile and wood flooring retailer, saw full year profits fall amid 'very challenging trading conditions'.

The firm said adjusted pre-tax profits came in at £13.9m in the 12 months to October, down from £16.3m the year before.

Group revenue was £175.5m, down from £182.4m in 2010, with like-for-like sales down 2%.

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The firm cut its final dividend almost in half, from 1p to 0.6p.

This took the total dividend to 1.1p, although this was up slightly on the full 2010 dividend of 1p.

Adjusted earnings per share were 5.50p, down from 6.18p the previous year.

Chief executive, Matthew Williams, said the firm expected economic conditions to remain difficult in 2012, with consumer budgets again under pressure.

"Our response will be to take further cost out of the business, grow margin and maximise sales opportunities, whilst making operational improvements that will position the business for future growth as economic conditions improve," he said.

However, the firm said it was still eyeing growth, and hoped to be able to expand its 321 UK stores to 400 in the future.

Seymour Pierce analyst, Kate Calvert, said she expected the housing market to remain subdued and sales elusive.

"The specialists are seeing increasing competition from the home stores being developed by the multiples and DIY," she added.

The firm's shares fell 1% following the announcement.

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