It was a case of two steps forward and three steps back for Topps Tiles in 2011, as progress made in the first six months of the year was more than wiped out by a sharp deterioration in trading in the second half.
After reporting a 1.8 per cent improvement in like-for-like sales in the first half, same-store sales slipped 2 per cent over the full year. Weakness has continued into the current trading year, with like-for-like sales down 6.9 per cent over the first seven weeks. Topps blamed the pressure on household income and said that it would respond with further cost-cutting and measures to improve its margin through efforts such as direct sourcing from its now operational new warehouse – that will support planned expansion to an eventual 400 stores from the current 321. Despite the tough trading environment, Topps opened a net eight stores in 2011 and plans five new stores this year, and will maintain its elevated marketing budget after successfully increasing market share.
Broker Seymour Pierce expects underlying pre-tax profits of £14m and EPS of 5.4p in 2012 (from £13.9m and 3.04p).
TOPPS TILES (TPT) | ||||
|---|---|---|---|---|
| ORD PRICE: | 22p | MARKET VALUE: | £41.4m | |
| TOUCH: | 22-23p | 12-MONTH HIGH: | 85p | LOW: 22p |
| DIVIDEND YIELD: | 5.0% | PE RATIO: | 7 | |
| NET ASSET VALUE: | * | NET DEBT: | £50.9m | |
| Year to 1 Oct | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2007 | 208 | 37.8 | 15.1 | 10.7 |
| 2008 | 208 | 27.7 | 9.60 | 3.00 |
| 2009 | 179 | 9.88 | 3.90 | nil |
| 2010 | 182 | 12.4 | 4.56 | 1.00 |
| 2011 | 176 | 7.91 | 3.04 | 1.10 |
| % change | -3 | -36 | -33 | +10 |
Ex-div: 28 Dec Payment: 31 Jan *Negative equity shareholders' funds | ||||
