Topps Tiles’ like-for-like sales fell 9.7% year on year in the third quarter as the retailer suggested it is seeing a small improvement in “challenging” market conditions.
The sales figure for the three months to June 29 was slightly lower than the 9.2% decline seen in the first half of the company’s financial year, but it said sales “stabilised” through the quarter.
“Market conditions have remained challenging overall, with subdued demand in the domestic repair, maintenance and improvement sector, especially for bigger ticket projects,” it said in a trading update.
Topps has seen trading ease back since enjoying record sales in its previous financial year as customers have tightened their belts due to high inflation and interest rates having been raised to their highest level since 2008.
Topps Tiles said the UK tile market is down between 10% and 15% compared with 2023.
Sales to trade customers continued to be more resilient than sales to homeowners, it said, while it continued to make “significant” gains in online sales.
The London-listed firm added that positive UK-wide data on inflation, wage growth and consumer spending in recent months “provides some confidence in a cyclical recovery and the group is well-positioned to benefit from this due to its growing market share”.
The headline inflation figure for the UK fell back to the Government’s target of 2% last month, according to the Office for National Statistics, in a sign that sharp price rises which have characterised the last two years are easing.
However, Topps said the recovery is “yet to feed through into our end markets” and that it will continue with a series of previously announced measures designed to boost sales, such as focusing on business-to-business trade and improving its website.
Other measures include launching a “modern trade app” and making that the default way many of its trade customers engage with the company, and improving clarity over pricing between the business and homeowner segments.
It is also hoping to expand into selling new products beyond its traditional porcelain and ceramic tiles, such as laminate flooring, shower panels and “luxury vinyl tiles”, as part of a bid to expand its addressable market from one worth an estimated £1.2 billion to £2.1 billion per year.