- Topps Tiles forecasts the newly imposed lockdown in England to weigh on sales.
- Higher online sales amidst COVID-19 restrictions are likely to weigh on the retailer’s margins.
- The Leicester-based company expects commercial business to recover in 2021.
In a statement on Wednesday, Topps Tiles plc (LON: TPT) warned that the newly imposed countrywide lockdown in England to combat the ongoing Coronavirus pandemic was likely to hurt its sales in the upcoming months and weigh on margins.
The COVID-19 crisis has so far infected more than 2.7 million people in the United Kingdom and caused over 76 thousand deaths. According to CEO Rob Parker of Topps Tiles:
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“While the latest lockdown restrictions will impact sales, at this stage it is very difficult to estimate the level of impact or how long this may last.”
Topps Tiles says customers are welcome to buy online
For the 13 weeks that concluded on 26th December, the tile retailer reported a 19.9% growth in its comparable sales. Topps Tiles attributed the increase to a greater demand for DIY projects as Britons continue to work from home.
The Leicester-based company said that its countrywide customers are still welcome amidst the restrictions to buy online. The additional costs associated with delivery, however, will weigh on its margins.
In separate news from Europe, French tyre maker, Michelin said that it will cut 2,300 jobs over the next three years.
Topps Tiles opened more than 1% down on Wednesday but gained roughly 3% in the next few hours. It is now trading at a per-share price of 57 pence versus a sharply lower 25 pence per share in March. If you want to invest in the stock market online, you will need a reliable stockbroker – here’s a list of the top few to make selection easier for you.
Topps Tiles expects commercial business to recover in 2021
Topps Tiles also highlighted on Wednesday that its commercial business that caters to the construction industry is taking longer than expected to recover from the COVID-19 disruptions. But the national retailer expressed confidence that its commercial business was now likely to improve in 2021. As per Topps Tiles, it is no debt-free.
In a report published in December, the British company had noted a 78% decline in annual profit as COVID-19 continued to wreak havoc on the construction industry. Topps Tiles had refrained from proposing a final dividend last month.
Topps Tiles performed fairly downbeat in the stock market last year with an annual decline of close to 20%. At the time of writing, the British national retailer has a market cap of £113.53 million.