Floorings specialist Carpetright (CPR) is licking its wounds after a profit warning in January. Judging by its full-year results, huge challenges still lie ahead. As expected, the adjusted pre-tax profit halved to £4.6m, as improved UK trading was offset by a poor showing in Europe. This profit figure strips out £11.8m of exceptional costs, mostly relating to onerous lease provisions, which explains why the reported results show a pre-tax loss.
In the UK, sales fell 1.5 per cent, with like-for-like revenue broadly flat. Good cost control and gross margin improvement meant adjusted operating profit dipped just 1.8 per cent to £10.7m. Trading was much worse in Europe, however. A deteriorating floorings market depressed sales, resulting in a loss of £3.8m.