Carpetright shares soar as restructuring plan starts to pay off
Shares in Carpetright soared almost 25 per cent this morning after it reported a “significant” improvement in sales as its restructuring plan begins to pay off.
The London-listed carpet specialist said like-for-like sales were up in the fourth quarter in a sign of renewed customer confidence.
Read more: Carpetright sales drop but pace of decline slows
Last year the firm entered into a company voluntary arrangement (CVA) to close dozens of stores in a bid to slash ballooning losses.
The move appears to be paying dividends, as Carpetright said its overall trading performance for the 12-week period to 20 April was in line with expectations.
“This has been a transitional year for Carpetright and we remain on track both with our recovery plan and our strategic initiatives,” said chief executive Wilf Walsh.
“Whilst consumer confidence remains challenged in the UK, the work we have done to reposition the business is starting to deliver the benefits necessary to put Carpetright back on the path to sustainable profitability."
Carpetright maintained its target of £19m in cash savings for the year.
Read more: Carpetright losses widen amid major restructuring
The company is one of a string of high street retailers, including Debenhams, New Look and Monsoon, to enter into a CVA in recent months amid tough trading conditions.
“Carpetright has given itself a fighting chance as it exited onerous leases and restructured the business to put it back on a path to profitability,” said analysts at Shore Capital.