Carpetright Plc Blames Heatwave For Sales Dip

Carpetright plc (LON:CPR) announces a decline in sales.

The content of this article was relevant at the time of publishing. Circumstances change continuously and caution should therefore be exercised when relying upon any content contained within this article.

When investing, your capital is at risk. The value of your investments can go down as well as up and you may get back less than you put in.

Read More

The content of this article is provided for information purposes only and is not intended to be, nor does it constitute, any form of personal advice. Investments in a currency other than sterling are exposed to currency exchange risk. Currency exchange rates are constantly changing, which may affect the value of the investment in sterling terms. You could lose money in sterling even if the stock price rises in the currency of origin. Stocks listed on overseas exchanges may be subject to additional dealing and exchange rate charges, and may have other tax implications, and may not provide the same, or any, regulatory protection as in the UK.

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More.

Shares in Carpetright (LSE: CPR) fell 3% in early trade this morning, following the release of the company’s interim management statement for the first quarter.

The weather played a major factor, with July’s heatwave offsetting the quarter’s positive start as customers elected to spend their time and money away from the house. In contrast, last year saw strong “wet-weather-assisted” comparatives, which led to a 1.9% decline in like-for-like sales this year, and a 3.3% fall in total sales.

The UK’s largest floor-coverings retailer also has problems in the Netherlands, which is seeing “extremely difficult” economic conditions currently, which contributed to like-for-like sales in the Rest of Europe — comprising Netherlands, Belgium and the Republic of Ireland — falling 10.6% year on year, and a decline of 10.9% for total sales.

Chief executive Darren Shapland commented:

“We saw solid growth in UK sales during May and June, reflecting the continued progress of our self-help activities.  During July this positive trend was reversed by the significantly warmer weather.  Excluding the expected decrease in sales from the wholesale business during the 12 week period, our core retail business would have reported a like-for-like sales decline of 1.0%.

“Notwithstanding the tough trading conditions, we believe we continue to grow market share in all of our markets and continue to see significant further potential in our planned self-help initiatives.”

Carpetright did see gross margin increase 80 basis points in the UK during the period, and 100 basis points across Rest of Europe, while the firm has also continued its plan to refurbish stores, with 202 of 473 (Q4 2012-13: 478) now modernised.

Today’s results were disappointing, especially after positive news from Carpetright’s preliminary results released at the end of June contributed to a sharp rise in the shares, bringing them up 10% from their price 12 months ago after they were down -5% only last month.

However, if you’re looking for another company that should soar in price, we’ve pinpointed our favourite growth share and produced a special report in which we evaluate its finances, risks and growth prospects going forward.

Simply click here to get your copy delivered to your inbox immediately — completely free.

> Sam does not own shares in Carpetright.

Should you invest, the value of your investment may rise or fall and your capital is at risk. Before investing, your individual circumstances should be assessed. Consider taking independent financial advice.

More on Company Comment

Hand of person putting wood cube block with word VALUE on wooden table
Company Comment

Value has been building behind the Diageo share price

Despite the business growing, the Diageo share price first reached its current level just over 19 months ago and hasn't…

Read more »

Older couple walking in park
Investing Articles

5 stocks to buy for high and rising dividend income

I can see a host of shares to buy on the FTSE 100 offering me exceptional levels of income. Here…

Read more »

Young mixed-race woman looking out of the window with a look of consternation on her face
Investing Articles

I don’t care if FTSE 100 shares fall further, I’m buying them today

I'm happy to go shopping for FTSE 100 shares today, even though I accept that they could have further to…

Read more »

Happy young female stock-picker in a cafe
Investing Articles

Rolls-Royce shares are down 18% in a month and I’m finally going to buy them

Investors who bought Rolls-Royce shares have been repeatedly disappointed, but I'm willing to take a chance on them before they…

Read more »

Storytelling image of a multiethnic senior couple in love - Elderly married couple dating outdoors, love emotions and feelings
Investing Articles

How I’d invest £10k in a Stocks and Shares ISA today

Now looks like a good time to buy cheap FTSE 100 shares inside a Stocks and Shares ISA. These are…

Read more »

Black father holding daughter in a field of cows
Investing Articles

Today’s financial crisis is the perfect moment to buy cheap shares

I'm building a portfolio of FTSE 100 stocks by purchasing cheap shares whenever I see an opportunity. There's a good…

Read more »

Long-term vs short-term investing concept on a staircase
Investing Articles

I’d buy Tesco shares in October to bag their 5.4% yield 

Tesco shares have fallen lately but I think this makes them attractively valued for a dividend stock I would aim…

Read more »

Young mixed-race woman looking out of the window with a look of consternation on her face
Investing Articles

I would do anything to hold Diageo in my portfolio (but I won’t do that)

Diageo is one of my favourite stocks on the entire FTSE 100 and I'd love to hold it, but one…

Read more »