British flooring specialist Headlam has endured a tough six months, blaming a drop in home improvement spending as the key factor behind a sharp fall in revenue.
The London-listed firm saw its revenue slide by just under 12 per cent year-on-year for the six months to June 2024, with UK sales down 11 per cent and sales across the rest of Europe plunging nearly 16 per cent.
Headlam pointed to “ongoing weakness in the floor coverings market,” blaming reduced consumer spending on home improvement projects for the slump.
The company, headquartered in Birmingham, reported a pre-tax loss of £16m for the period.
Despite the challenges, Headlam highlighted progress in its strategic growth plans, with revenue from trade counters surpassing £100m so far this year.
Chief executive Chris Payne commented on the performance, emphasising the firm’s efforts to adapt in a tough environment.
He said: “While current market conditions remain challenging, we are pleased with the early progress we have made on accelerating our simplification and integration of the business together with the development of exciting improvements to our customer offer and service.
“We remain confident that our strategy, and the changes we are making, will strengthen Headlam over the medium term, ensuring that we are well placed to take the opportunity when the market recovers.”
Headlam said it expects trading to improve in the second half of its financial year, “assuming market conditions gradually improve.”
However, the company cautioned that it doesn’t foresee the market returning to growth until 2025.
On that basis the company said it expected to continue to trade in line with expectations.
In March, shares in Headlam took a sharp hit after the company slashed its annual profit guidance, falling well below market expectations.
In a bid to reassure investors, Headlam announced it expects a significant one-off cash boost from the sale of surplus property and a reduction in working capital over the next 18 months.