Topps Tiles Plc
Withdrawal of funding from Dutch subsidiary
The Board of Topps Tiles Plc ("Topps" or "the Group"), the UK's largest tile and wood flooring specialist, announces that it has taken the decision to withdraw support and funding for its loss-making Dutch subsidiary. As a consequence, the Board believes that the Dutch business is unlikely to be able to continue trading on a going concern basis.
The Dutch subsidiary comprises 12 stores and accounted for 4% of the Group's revenue in 2009, but made a loss of £4.9 million during the last financial period. Topps continues to trade from 308 stores in the UK, and the UK business will not be impacted by this decision. There is likely to be a c.£1m one-off non cash write down impacting the Group's results as a consequence of this action. As disclosed in the annual financial report, issued on 24 November 2009, in the first 7 weeks of the new financial period UK revenues increased by 2.2% on a like-for-like basis. Since that date, our UK trading figures have continued to follow an encouraging trend, and we will give a full update on current trading in our AGM and Interim Management Statement which will be published on January 12th 2010.
The Board of Topps undertook an extensive review of the Dutch business during 2008 and 2009 during which time the management team of the Dutch business was reorganised and it became apparent that significant structural issues needed to be addressed. The restructuring of the business on a financially sustainable basis has not been successful and the business has faced increasing challenges as financial performance has declined, in part driven by the difficult economic climate. The business has been loss making since 2008 and current trading is significantly behind revised financial targets set by the local management team.
This has been a difficult decision for the Board to take, but it believes that this is the right course of action, as any further investment in the Dutch business is not economically viable and would not be in the best interests of the UK parent company and its shareholders.
For further information please contact:
Topps Tiles Plc
Matthew Williams, CEO
Rob Parker, Finance Director
c/o Bell Pottinger Corporate & Financial 020 7861 3232
Emma Kent / Duncan Mayall
Bell Pottinger Corporate & Financial 020 7861 3232
Garry Levin / Matt Goode
KBC Peel Hunt 020 7418 8900
This information is provided by RNS
