Carpetright has slashed its latest full-year profits forecast to between £3 million and £4 million due to a “weak and volatile” market.
The news means its full year projections are a whopping £7 million below the forecasts of City analysts and in stark contrast to the £16.9 million the company declared for the previous financial year.
Sales across the group declined by 4.2% while sales in the UK declined by 3.2%. Like-for-like sales nudged upwards by 1.4% which was attributed to a slight uplift in sales from refurbished stores.
Philip Harris, chairman and chief executive of Carpetright, said the fragile confidence of the company’s customers continues to produce a weak floor coverings market.
He added: “We are encouraged to see the UK floor coverings business return to like-for-like sales growth and are cautiously optimistic that this trend will continue in to the new financial year.
“In contrast to this, bed sales, while still showing growth, have been below management expectations and tougher trading conditions in the Netherlands and Belgium have also contributed to a weaker group result for the final quarter.”
Carpetright – which has 491 stores in the UK – saw its shares fall 5% this morning after Freddie George, analyst at Seymour Pierce said the chain was too focussed on price rather than value and service.