Carpetright warns on profits as Netherlands business suffers

Like-for-likes in the retailer’s European business, which includes the Netherlands as well as Belgium and Ireland, dropped 7.7% in the 13 weeks to January 25 while total sales fell 7.5%. Belgium and Ireland performed in line with expectations.

Carpetright’s UK like-for-likes advanced 1.9% during the period and total sales edged up 0.6%.

Carpetright executive chairman Lord Harris said that although trading remained tough in the UK, self-help measures enabled the retailer to increase sales and profit is in line with expectations, and ahead of last year. 

Lord Harris said: “Trading in our Europe business continues to be dominated by the extremely difficult economic conditions in the Netherlands. As a result we now expect this business unit to be loss making for this financial year, although we still expect it to remain cash generative.

“In view of the market conditions, predicting the final outcome for the year with any accuracy is difficult and the result for the year will depend on our performance in the final quarter. 

“In the UK, the pace of the recovery remains uncertain in the face of continuing sales volatility but we are confident that our self-help measures have further potential. 

“However, with a further weakening of the market in the Netherlands, we now expect underlying pre-tax profits for the full year will be below the lower end of the current range of market expectations.”