Carpetright shares crash 41.9% amid profit warning

Specialist carpet retailer Carpetright has issued another profit warning prompting shares to fall by 41.9%, at the time of writing.

Analysts expected profit figures of £15.6m for the year, but the firm revised its full-year profit guidance to between £2m to £6m.

Sales for the post-Christmas period were significantly behind expectations, with total group sales down by 2.3% and like-for-like sales (which exclude store openings and closures) down 3.6% for the 11 weeks ending on 13 January 2018.

Carpetright said UK-to-UK trading was impacted by lower customer footfall, with transaction numbers down significantly year-on-year.

Core flooring like-for-like sales declined by 7.1%. Two stores were opened and four closed in the year to date.

Wilf Walsh, CEO noted that there had been a positive start during the third quarter of the trading period but explained that the company saw “a significant deterioration in UK trading during the important post-Christmas trading period”.

He said average transaction values were up year-on-year but volume since Christmas was “sharply down”, and attributed the drop to “reduced consumer confidence”.

“Our response to the threat of new competition continues to be effective, with those stores that have traded against new local competition for more than 12 months performing ahead of the rest of our estate,” he said.