Carpetright in profits warning after poor Dutch sales
- 28 January 2014
- From the section Business
Carpetright, the struggling European floor coverings retailer, has issued another profits warning, blaming poor trading in the Netherlands.
"We now expect our full year underlying pre-tax profit to be below the lower end of current market expectations", the company said in a statement.
UK like-for-like sales - which strip out the effect of new store openings - grew 1.9% for the 13 weeks to 25 January 2014. Total sales were up 0.6%.
Sales in the rest of Europe fell 7.5%.
After the impact of currency movements, total sales in Belgium, Ireland and the Netherlands fell 6.3%, the company said.
Executive chairman Lord Harris said that trading conditions in the UK had been "tough" and "volatile", but expected profit "to be ahead of last year for the year as a whole."
But trading in the rest of Europe, particularly the Netherlands, was "extremely difficult", he said, meaning the division would be loss-making for the year.
As a result, full-year pre-tax profits would be lower than expected, he said. Analysts had been expecting pre-tax profits of about £9m-to-£10m for the year.
This is the company's second profits warning in four months.
The last one in October led to the resignation of Darren Shapland, the former Sainsbury's director who took over as Carpetright chief executive in May 2012.
He stayed with the business for just 17 months.
Carpetright has 473 stores across the UK and 142 in the rest of Europe.
Founder Lord Harris is a Conservative peer and a party donor who has also founded a number of academy schools.
He is also a non-executive director of the retailer Matalan and Arsenal Football Club.