Topps Tiles has warned that they are facing “significant” cost pressures amid the Autumn Budget and that profits have almost halved this past year.
The flooring retailer reported in the year to 28 September underlying pre-tax profits of £6.3 million, compared to £12.5 million the year before and store sales have slumped 9.1%.
During the Autumn Budget the Chancellor raised the minimum wage and increased employers national insurance contributions from next April adding an extra £4 million to their wage bill and an additional £2 million to the NIC.
Topps said, “There remain significant inflationary challenges facing the business in 2024-25.
“Given these cost increases represent a high proportion of the current level of profitability in the group, they will need to be managed very carefully, and the business is currently formulating plans to mitigate these costs as far as possible.”
Topps Tiles added, “Whilst some macroeconomic indicators suggest a more favourable outlook into 2024-25, including mortgage approvals up substantially year on year, overall there remains significant uncertainty around the timing of any recovery, particularly whilst consumer confidence remains weak and interest rates relatively high.”
