Carpetright's Harris says trading is worst ever
Wednesday 29 June 2011
Carpetright's chief executive, the veteran Lord Harris of Peckham, said yesterday that trading conditions were the worst he had seen in more than 50 years in business.
Lord Harris said he was preparing for two more years of tough times as Carpetright cancelled its final dividend. "It's very tough out there," he said. "It's the toughest I've known since I've been in the business."
He blamed the weak housing market, government cuts and rising taxes for depressed consumer confidence with a knock-on effect on sales and profitability.
"Everyone is uncertain at the moment," he added. "When the cuts are out of the way and people know where they are, things might improve. If you've got two people in an office and one is going to go, they will both stop spending."
Carpetright will cut its number of stores by reviewing 50 when their leases come up for renewal over the next three years, Lord Harris said. He said the group would probably open 30 or 40 other stores in that time.
Lord Harris called on the Government to signal a reduction of the 50p tax rate to encourage job creation. "Including national insurance, we don't have a 50p tax rate, we have a 63p tax rate and with other benefits that means you have to earn £100,000 to employ someone on £30,000 and that's a lot," he said.
Carpetright, which has about 700 stores in Britain, Ireland, Belgium and the Netherlands, posted an underlying pre-tax profit of £16.9m in the year to 30 April – down from £28.2m the previous year. Sales in the UK and Ireland fell 6 per cent. Carpetright shares fell 22.5p, or 3.5 per cent, to 667.5p and have fallen 17 per cent this year. It paid an 8p interim dividend but will not make a final payout.
In more bleak news for the high street, TJ Hughes, the department-store chain, announced it was on the brink of administration. Founded in Liverpool in 1912, the company has 57 stores and 4,000 staff. In the year to 31 January, it lost more than £10m and was on the brink of collapse when Endless acquired it for a "nominal amount" in March.
- 1 Nigel Farage: Me vs Russell Brand on Question Time – he's got the chest hair but where are his ideas?
- 2 Harry Potter fans can apply to the Hogwarts-inspired College of Wizardry
- 3 Jessica Chambers: 19-year-old woman 'doused with lighter fluid and burned alive' in the US
- 4 Russell Brand calls Nigel Farage 'poundshop Enoch Powell' in BBC Question Time debate
- 5 Orange Wednesdays are no more
Weather bomb in pictures: Storms cuts power for tens of thousands – and snow is on the way
Jessica Chambers: 19-year-old woman 'doused with lighter fluid and burned alive' in the US
Russell Brand calls Nigel Farage 'poundshop Enoch Powell' in BBC Question Time debate
Russell Brand was rendered speechless on Question Time by this man
Fury at Airbus after it hints the super-jumbo may be mothballed
Disgruntled RBS worker writes hilarious open letter to Russell Brand after anti-capitalist publicity stunt leaves him hungry
Shock poll shows voters believe Ukip is to the left of the Tories
Nigel Farage's approval rating hits record low as popularity suffers in wake of Ukip sex scandal
Ukip candidate jokes about 'shooting peasants' in racist and homophobic rant
Pakistan school attack live: Taliban kill at least 132 children in 'horrifying' massacre
Germany sees 'visible rise' in support for far-right extremism in response to perceived 'Islamisation' of the West
iJobs Money & Business
£32000 - £35000 per annum + benefits: Ashdown Group: Marketing Services Manage...
£Neg. (DOE) + Excellent Benefits: Guru Careers: A Finance Account Manager with...
£40000 - £470000 per annum + bonus: Ashdown Group: Java Developer / J2EE Devel...
£45000 - £55000 per annum + Benefits: Ashdown Group: An exciting opportunity h...