Flooring market "weaker than projected"
Leading UK flooring distributor Headlam says the flooring market is down 10–15% with no sign of improvement in the second half of 2024.
The PLC was reporting the performance for the five months to November 30 and announced its revenue was down 7.3%. It said it had benefited from Carpetright exiting the market, otherwise its result would have been closer to the 11.3% decline it saw in the first half.
Headlam CEO Chris Payne said: "The challenges impacting the UK flooring market have continued to weigh on our trading performance in the short term.
"While the lead indicators for the flooring and home improvements markets continue to point to improvement in the medium-term, these indicators remain volatile. As has been widely reported, UK consumer confidence declined in the run-up to the UK government's budget announcement, and this resulted in a further deterioration in the rate of decline in consumer spending on home improvements," he said.
- "Consequently, there has been no sign of improvement in the flooring market during the second half of the 2024 and we estimate that the market continued to decline at 10-15% year-on-year, in line with the first half," said Chris.
Headlam is positive about the progress it is making in ite transformation plan which includes the consolidation of 32 trading businesses into one single, national business trading as Mercado and the simplification of its distribution network and with centralising its buying and stock control systems.
"The Board remains encouraged by the significant progress we are making against our strategy and transformation plan to simplify our operations and improve our customer offering. In light of the additional market headwinds, we are extending this programme to target greater benefits over the next two years," said the company's statement to shareholders.
"This progress remains critical to ensuring the business is positioned for long-term success given the wider current macroeconomic uncertainty and its impact on consumer confidence and our markets in the near-term," it said.
