Carpetright remains under pressure as store closures mean like-for-like sales ‘remain negative’
Low sales have forced British retailer Carpetright to close 67 stores in the first half of the year, it said today.
The FTSE 250 firm closed those that failed to reach sale targets, with six further retail sites expected to shut shop by the end of 2018, the company told investors today.
Carpetright did not share sales figures in its update but reported that trading had improved in its second quarter ending 27 October.
However, like-for-like performance "remained negative" amid the store closures, it said.
Stressing that the results had been "anticipated", Carpetright added that the restructuring programme "began to take effect" in the second quarter after its company voluntary closure (CVA) strategy was approved earlier this year.
Investors backed the CVA in April, before Carpetright raised £65m via an equity issue in June.
“We remain confident of achieving the £19m of annualised benefits announced as part of the recapitalisation of the group in May 2018”, the company added.
Shares dipped 1.34 per cent yesterday ahead of the announcement, but edged up 0.5 per cent after the news in early morning trading. So far this year, shares have dived a staggering 89 per cent.
Paul Hickman, analyst at Edison Investment Research said:“Carpetright’s first-half trading statement says little about the underlying state of its market and far more about the progress on its internal restructuring.
“Like-for-like sales after the disruption already reported in the first eight weeks was still negative, but less so, as underperformers drop out of the comparison.
“Management has progressed strongly with its grim task of store closures. In return, it reassures on the planned cost benefits of £19m.”