Sparks

Topps Tiles has reported an encouraging trading update that shows a good acceleration in the rate of year-on-year sales growth in the most recent five weeks of Q125 to continue the previously indicated return to growth. On an underlying basis, group sales ex CTD Tiles increased by 8.4% in the last five weeks of Q125 versus the 1.2% growth previously reported for the first eight weeks of the period. An easier comparative as the quarter progressed (from -3% in first eight weeks of Q124 to -4% for Q124 as a whole) helped a little but there is a clear improvement in sales towards the end of the period. Against a challenging backdrop the company is making progress on its five key growth areas under its Mission 365 goal, and it is clear that its initiatives to drive incremental revenue from trade and omnichannel customers are working. For example, there was strong trade growth in the Topps Tiles branded stores of +13.5% while Pro Tiler Tools continued to grow strongly, up 20% in the period, which is impressive as it relocated to its new warehouse. In digital, sales transacted online increased by 8%, online trade sales for the Topps Tiles brand grew by c 60% and Tile Warehouse sales increased by c 140%.

With respect to the acquisition of CTD Tiles, the statement indicates an expected decision by the Competition and Markets Authority’s phase 1 enquiry by 17 February 2025.

In addition to the trading update, the CEO, Rob Parker has notified the board of his intention to retire from the business after 18 years, including 12 years as CFO.

The trading update indicates good progress on its growth initiatives that is helping to drive an underlying improvement in sales. While the macroeconomic environment remains uncertain, the company will be helped in FY25 by weak comparatives for the rest of the financial year, more notably in the next two financial quarters.