CPR Carpetright Plc

    RNS Number : 8006G
  Carpetright PLC
  28 October 2008
   
     

    Carpetright plc
    Pre-close Trading Update

    Carpetright plc, Europe's leading specialist carpet and floor coverings retailer, today publishes its First Half Trading Update for the
first 25 weeks of its financial year, representing the trading period from 4 May to 25 October 2008.

    Group sales decreased by 5.9%, with the store base at 689 stores at the period end.  

    The UK and Republic of Ireland business recorded a sales decrease of 11.2%, with like-for-like sales down by 12.5%.  Despite this, there
has been an improvement in the gross margin as anticipated.  Within the UK and Republic of Ireland, 13 stores opened during the period and
11 have been closed, increasing the total number of outlets to 561, including 60 concessions and 39 Storeys stores.

    Our business in the Rest of Europe (The Netherlands, Belgium and Poland), continues to make good progress.  Sales in local currency have
increased by 12.0%, with like-for-like sales up 2.3%.  As previously stated, we completed the EUR7.8 million acquisition of the trade and
assets of Ben de Graaff Tapijt, a floor coverings retailer in the south of The Netherlands, on 30 June 2008.  Along with one new store
opening in The Netherlands, this brings the store base in the Rest of Europe to 128 stores.

    Trading in the UK and Republic of Ireland continues to be challenging, as the deterioration in the housing market and the turmoil in the
financial markets has severely impacted consumer confidence.  In our September announcement, we said October and November were important
trading months. Trading in October has been above the year to date trend but continues to be weak. Consequently, management have become more
cautious about expectations for the full financial year.

    Against these difficult conditions, we continue to examine opportunities to increase our profitability by looking at complementary
markets. We are now at an advanced stage of negotiation to acquire the assets and business of Sleepright UK Ltd, who currently retail beds
in 94 Carpetright stores on a rental concession basis. We expect to complete the transaction by early December for a modest initial cash
consideration, funded from internal resources. The Sleepright format has been trialled successfully over the past 18 months, delivering
incremental sales within the same floor space. We are now taking the opportunity to utilize the scale and infrastructure of the Group to
enhance Sleepright's profitability.

    There have been no significant changes to the financial position of the Group since the publication of the Preliminary Results on 1 July
2008.

    Lord Harris of Peckham, Chairman and Chief Executive, said:
    "The trading environment in the UK continues to be extremely difficult. We see this continuing for at least another 18 months. The
Sleepright acquisition, whilst small in size, provides a good opportunity to enhance the use of our existing floor space and improve UK
profitability.

    Trading in Europe has improved since Q1, and remained relatively resilient to the recent turmoil in the financial markets although we
are taking a conservative view of prospects for our European business for the balance of the year.    

    As I have said before, these current market conditions are the most difficult I have seen and we are now taking a more cautious view of
prospects for the full financial year.''

    The Group will report its Interim Results for the six months to 1 November 2008 on 16 December 2008.


    Analyst conference call

    Lord Harris and Neil Page will host a conference call for analysts at 08.15am this morning. 

    The dial in number is +44 (0) 203 003 2666, with a password "Carpetright". 

    Thereafter, for further enquiries please contact:

 Carpetright plc                                       Tel: 01708 802000
 Lord Harris of Peckham, Chairman and Chief Executive
 Neil Page, Group Finance Director

 Citigate Dewe Rogerson                                Tel: 020 7638 9571
 Kevin Smith / Angharad Couch



    28 October 2008        


    Carpetright plc
    Pre-close Trading Update


                              2008/2009         2007/2008
 Store Base - Numbers        25 October  3 May   27 October 2007
                                   2008    2008
 UK & RoI
   Carpetright                      462     460              445
   Concessions                       60      61               66
   Storeys                           39      38               35
                                    561     559              546
 Rest of Europe*
   The Netherlands                   89      77               76
    Belgium                          28      28               28
    Poland                           11      11                8
                                    128     116              112
 Group Total                        689     675              658




                              2008/2009       2007/2008
 Store Space (knsf)          25 October  3 May    27 October
                                   2008     2008        2007
 UK & RoI
   Carpetright                    3,963    3,963       3,888
   Concessions                      119      121         139
   Storeys                          397      387         370
                                  4,479    4,471       4,397
 Rest of Europe*
   The Netherlands                1,081      895         888
    Belgium                         335      335         337
    Poland                          115      115          83
                                  1,531    1,345       1,308
 Group Total                      6,010    5,816       5,705

    * excludes joint venture in Germany


This information is provided by RNS
The company news service from the London Stock Exchange
 
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