Consumers cut back spending says Headlam
Leading flooring distributor Headlam has reported a decline in UK sales as consumers cut back on interiors spending, though November has rallied after a slow Autumn, it says.
In a trading update to shareholders the plc said: "After a relatively robust summer trading period, the market in September and October was weaker than expected, reflecting the impact of the cost-of-living crisis on residential RMI* as consumers cut back spending on home improvement projects.
"However, the Group’s November trading was improved, with a step up in average daily sales compared to October, albeit volumes and revenue remained below the previous year and typical seasonal uplifts," it said.
According to the trading update in respect of the eleven months of the year to 30 November 2023, Headlam expects full year results to be “broadly in line with expectations”, based on the trading patterns observed to date.
“In the UK the revenue for the Period is slightly positive year-on-year, offset by revenue decline in Continental Europe, resulting in Group revenue being flat year-on-year for the first eleven months. In the UK, the Group saw a 5% volume decline year on year, although this is in line with the overall market according to data for the 12 months to October 2023," says the company's statement.
“Despite the general market backdrop, revenue from Larger Customers and Trade Counters has remained strong, with year-to-date growth of 27% and 9% respectively; November itself was a record month for revenue from Larger Customers," it said.
Headlam has already reported that the volume of sales in the UK market are around 20% lower than in 2019 on a rolling 12-month basis. But it comments: "Whilst there is uncertainty over the short-term outlook for the market, we remain optimistic about the medium-term prospects for both the market and our opportunities to grow market share."
* RMI = repair, maintenance and improvement
