Topps Tiles share price jumps on 2020 profit forecast following robust summer sales
Topps Tiles share price rose by more than 13 per cent this morning after a trading update revealed it is expecting to make a “modest” profit in 2020 after a strong start to its final quarter.
The tile specialist has seen a surge in demand since stores reopened at the start of July and has reported a year-on-year jump in sales of 15 per cent for the six weeks ending August 8.
The company’s average weekly sales stand at £4.4m for the period and have recovered steadily from April’s lows of £0.8m.
It said it now expected to make a “modest level of profit before tax” for the year ending September 26.
The firm cited “home improvement demand” and “DIY activity” as key reasons for the upturn in sales and added that online sales remained above previous levels.
All stores across the UK are open again with the majority operating seven days a week.
Topps Tiles is also no longer using the government’s furlough scheme.
It said that although it was “unusually difficult to assess the outlook beyond the short term” due to Covid-19, its performance so far had been “significantly better” than expectations.
“I am pleased with how well the business has navigated the crisis to date and feel that we are well positioned for whatever comes next,” said chief executive, Rob Parker.
“Our response to the pandemic has strengthened the business and fundamentally improved our liquidity position, providing further flexibility and putting us in a strong position both to benefit from the recovery in our markets and to meet any future challenges.”