T 01482 659396
+44 1482 659396
diane@mayvillepublishing.co.uk
Likewise expands into profitability
May 25, 2022
The fast-growing UK flooring distribution business Likewise has boosted sales by 28% and achieved its first profits after three years of rapid growth.
Tony Brewer, chief executive of the Birmingham-based group, said: “Likewise is very pleased to announce it has delivered its first profit following the initial 3 years of investment to establish a meaningful floor covering distribution business in the UK.
"Likewise continues to increase Sales Revenue and Gross Margin on a like for like basis. With the infrastructure established and further investment in Sales and Marketing, the Board considers that the Group has the Management and Teams in place to out-perform market conditions and increase market share," he told shareholders in a presentation of the final results for the year ended 31 December 2022.
The Likewise group has acquired and grown several brands as it expands across the UK and includes businesses such as A&A, Factory Flooring, H&V, William Armes (Dandy), Bruce Starke and Lewis Abbott. This year, it has acquired Valley Wholesale Carpets and Delta Carpets.
Sales for 2021 were reported at £60.5m compared to £47.3m the prvious year and the gross profit margin improved to 30% (26% in 2020). As a result, Likewise made a profit before tax of £1.8m and has declared its first dividend to shareholders of 0.2p per share.
The Group continues to develop its logistics infrastructure. Its Birmingham hub is now operational which doubles the carpet capacity for the Likewise branded businesses. Construction is underway for a new Distribution Centre in Glasgow and the business in Newcastle has now moved into an enlarged facility adjacent to its previous location. Valley and Delta added further to this network.
SEARCH OUR NEWS SERVICE
FEATURED ARTICLES
Earlier this year, John Clark became Managing Director of Regional Distribution at Headlam. In his new role, he is managing and assisting Headlam’s General Managers in supporting independent retail customers across the UK. Headlam has been successfully implementing its strategy of broadening its customer base, including the expansion of trade counters and enhanced relationships with larger customers and house-builders. However, John talks to us about how independent retailers remain Headlam’s biggest customer group, and his team will continue to invest in improving service and quality for his customers.
In tight trading conditions, it is added-value, mid-market products that are coming through in development to attract consumer interest. Our review of the INDX event in Solihull reveals the latest trends that will be shaping the sales profile in Q4 and 2025.
Headlam is aligning three of its leading brands – Manx Tomkinson, Fells and Kingsmead – to deliver enhanced support to UK flooring retailers. This strategic move takes effect from June 1 and will streamline operations across the three brands with a dedicated sales team of 19 representatives nationally. This initiative aims to offer retailers a single point of contact for all their nneeds and to give personalised and efficient support throughout their partnership with Headlam. Heading up the venture as National Sales Manager is Keith Morgan, a seasoned industry professional with over 40 years of experience who was spearheading Headlam's Telenzo brand and who has a previous track record at Hugh Mackay and SCS. Keith Morgan expressed his enthusiasm for the initiative, saying, "By aligning the three brands, we aim to optimise our support for retailers, providing our customers the convenience of a single dedicated representative for Manx Tomkinson, Fells and Kingsmead. "This strategy ensures retailers receive top-tier service and support. Our objective is to streamline the partnership between retailers and quality brands, nurturing stronger relationships and enabling seamless collaboration," he said. This strategic move reflects Headlam's commitment to driving excellence in customer service and support within the flooring industry. By aligning the three leading brands under a unified sales team, the team aims to elevate the retail experience and empower its partners for success, says the Group. www.headlamgroup.com
Fast growing UK flooring distributor Likewise has confirmed a 13% growth in sales and its first single-day order intake of £1m. Likewise directors say the Group is on course to achieve it's target of becoming a £200m business after reporting group sales increased 12.9% to £139m and earning were up to £7.9m from £6.6m in 2022. And the growth continues this year. The statment to shareholders said: "The Group has again made significant progress in 2023, which has continued into the first four months of 2024, with Group Sales to the end of April increasing by 8.7% and Sales in Likewise Branded businesses increasing by 15.3% compared with the prior year." CEO Tony Brewer commented: "“The Group has made significant progress in the last three years. The Board thanks the Management, Sales Teams and all Staff for their tremendous contribution to developing the Group and what has been achieved in such a short time. "Despite challenging market conditions, 2024 has started positively and we have every confidence of a successful year and most importantly another major step towards our medium term objectives," he added. The group's first-ever £1m order intake in one day was achieved in April and has boosted confidence at the ambitions company in the ability of its servise and logistics to handle high volumes of trade. Likewise used the annual results statement to map out its current scale which comprises: 11 Distribution and Logistics Centres created with total capacity at c.15 million cubic feet 80 Suppliers across key flooring products 94 Customer focused Management and Sales Executives 139 Delivery trucks providing next day service 507 Employees, with a significant majority with long-standing flooring experience 100,000’s of point of sale items creating market presence Over 5,000 Customers, principally independent flooring retailers and contractors www.likewiseplc.com
UPDATE: 17 May 2024 The Flanders Flooring Days event closed yesterday after an impressive week with 3,474 visitors from more than 78 countries. "The successful third edition of Flanders Flooring Days definitely left visitors with a taste for more," say organisers. So the fair will be taking place again in 2025, this time from 2 to 5 June. Put the date in your diary now. ---- Flanders Flooring Days has established itself as a leading showcase event for leading European manufacturers as it opened its third event based around the Belgium town of Kortrijk. The major marketing event involved 52 companies mainly from Belgium, the Netherlands and Holland with 14 hosting displays at their showrooms in the region and 38 taking exhibtion space at The Hub in the Kortrijk Xpo centre. The event opened on Monday in glorious sunshine in Flanders and runs for four days in a show that is seen by many as a successor to Domotex. The displays by leading manufacturers at the Kortrijk Xpo centre we to a very high standard in a well presented environment at the modern facility in the town. The Stocklists visited some of the UK's major European brands including Associated Weavers, Beaulieu, Condor, Betap, Edel, Intercarpet, Lano, Lamett, LDP, Unifloor and Vebe and will be bring you detailed reports in our next issue. www.flandersflooringdays.com
Headlam – the UK's leading flooring dsitributor – warned that the market will not return to growth until 2025 after announcing it's sales had fallen 12.3% year-on-year for the four months to the end of April. The Group 's UK division was down by 11.6 % per cent and Continental Europe sales contract ed by 16.9 % and it announced a pre-tax loss of £10.6m over the first four months of 2023. Headlam said revenue in April did not show the expected seasonal uplift during spring, traditionally seen as a strong period for house sales in Britain and as a result, the company said it expects full-year profit 'to be significantly below current market expectations'. However, Headlam remain s upbeat and said it expects an improvement in the second half. In a trading update to investors, CEO Chris Payne said: "Whilst the medium-term outlook for the business remains strong, the current trading conditions across the sector have been challenging and we have seen a further deterioration in consumer spending in our markets, which has weighed on profitability." He dded: "D espite these headwinds, the balance sheet remains strong, it is pleasing to see the strategic growth areas continuing to perform well and, with the acceleration of our strategy, we have a great opportunity to simplify our customer offer to significantly improve the Group's profitability and further improve our cash position. " www.headlam.com/
A competitive revolution is coming for independent retailers in the flooring sector in 2024 - the E-Floorcentre Alliance. Listen up if you are an independent retailer who is fed up with the lack of a level playing field in your competitive position, thanks to increasingly consolidated flooring distributors, fast growing online platforms and ever-expanding multiple competition. “Independent retailers can see that more business is slipping away from them each year,” says Ken Robb of the Independent Flooring Group (IFG) and Floorstars. And he has started the revolution. He plans to redress the balance with an ambitious concept that keeps independent retailers relevant and secures their future. Known as the E-Floorcentre Alliance , participating Independent retailers can become part of a nationally promoted network with exclusive branded products, a national e-commerce platform, a logistics operation with up to 20 hubs across the country and full access to the Floorstars network of skilled installers. Floorstars enable retailers to offer ‘full service’ anywhere in the UK to service out of area business generated by E-Commerce. The concept was launched at the IFG Conference in April and is set to make a major difference to the way independent retailers do business. IFG are working with leading manufacturers to supply distinctive products to retailers across the mainstream sectors for carpets and vinyl flooring. These own branded ranges will have nationally consistent online to store pricing parity to avoid comparison issues.
Herringbone is undoubtedly one of the happiest success stories in growing the market for vinyl but designers across the sector know that it’s not all about wood. Stylish stone in creative decors and formats is addressing a key demographic that is looking for something different and distinctive. Tiles are never the best sellers overall in any collection, LVT or otherwise. Some distributors don’t even bother to include them in their ranges. Is that changing? Well yes actually, in the home sector, it is, says Tarkett . “I think it’s driven by the higher end of the market for sure, and we’d always assume an older demographic. Well, the population is getting older and it’s the mid to high end which is remaining stable, so these designs are more important than ever today,” says Tarkett’s UK marketing manager Steve Urwin. Steve highlights two key trends: “Finally the smooth, sleek concrete tiles are here, I mean they’ve always been here thanks to our continental colleagues, but now they are selling.
BUSINESS NEWS
After a tough winter of declining flooring imports, carpet sales into the UK have jumped for the first time since October 2023 – vinyl sales, however, are faring much less well. Carpet imports into the UK in April jumped 10% to £77.8m according to HM Revenue & Customs figures compiled by The Furnishing Report . Belgium, which has had a torrid time of falling sales into the UK finally showed substantial improvement, up 17% in April. Turkey, meanwhile, is racing ahead with imports into the UK up 55%. Imports across all flooring types r ose 3.4 % to £129 million , held back by a double-digit decline in vinyl floorcovering, a sector badly hit both in terms of supply and pricing by the shipping crisis in the Red Sea which has inflated costs as containers are diverted along much longer routes - see related news item .
Leading carpet company Cormar maintained its sales last year despite the challenging market conditions and says it's in a strong position and cautiously optimistic about the future. Filing its accounts this week for the year ended 30 September 2024, the company showed sales stable at £147.8m (£148.1m in 2022) and pre-tax profit up a little at £5.9m (£5.6m in 2022). "Demand for our carpet remained resilient throughout the year despite the squeeze on household income caused by high inflation and higher interest rates," said the company in its review of the business statement. Cormar said that while volumes remained robust, margins were hit by high raw material costs and energy prices, and compounded by adverse exchange rates. "Higher average selling prices, coupled with a recovery in sterling and tight cost control, improved operating margins in the second half of the year, helping full-year operating profit margins recover from their prior year lows," said the company. "The business finished the year with gross margin in a strong position, providing us with cautious optimism for the year ahead."
Container costs are back in the headlines for flooring importers with the vinyl sector espeically under pressure as a tight consumer market combines with rising freight charges to hit margins. LVT suppliers have been discounting retail prices in ther lack-lustre first half of 2024 to stimulate sales but several have told us that this strategy has been impacted by freight costs that has seen the spot rate for shipping a 40ft container jump from $3,000s to as much as $5,000. As a result, sales margins have evaporated in some of the sector and inventory building for the hoped-for recovery in the Q3/4 sales season is looking expensive. The container costs have been impacted primarily by the ongoing crisis in the Red Sea since Houthi rebels in Yemen started attacking shipping before Christmas. Port congestion in key hubs in Western Europe has exacscerbated the problem. Not eveyone is losing out however. Maersk, a global leader in container shipping announced last week that profits could rise to $9 billion for 2024 due to the crisis but in better news for importers, it has also warned shareholders that a wave of new container vessels entering the market this year and next will cause overcapacity and hurt profit. Analysts at Bernstein expect a 15% fleet expansion across 2024 and 2025, outstripping demand.
SCS may withdraw from the flooring business across its 100 UK stores to focus on sofas and furniture. The Sunderland-based chain believes its market share in flooring has not grown sufficiently strongly despite investment in the sector, according to leading furniture trade title The Furnishing Report which quotes sources close to the company. The C in SCS stands for Carpets but was dropped as a strapline in the recent rebranding and there has been some anticipation of this move by the company following its acquistion by Italian upholstery retailing group Poltronesofà earlier this year. Flooring generated £30.1 million of in-store flooring sales for SCS in 2022/23, down from £32.6 million the previous year. SCS chief executive Steve Carson is to leave the company later this summer after three years at the helm. Mr Carson joined SCS in January 2021 from Holland and Barratt, succeeding longtime head David Knight.
Flooring sales stabilised in April despite another substantial decline in the wider furniture sector, according to latest data from the ffice for National Statistics (ONS). S ales of floorcoverings were down 1.4 % to £211.5 million in April . This contrasts sharply with a 14.2% drop in the value of sales in the furniture and lighting sector, the biggest decline there for over three years. Overall UK retail store sales in April declined by 2.7 % while online sales were up 3% following a poorer performance last month. The ONS has also uprated March figures for flooring t o a healthier 3.8% rise, now factoring some late data – this is more than double the rise published by the ONS last month.
The leading index on consumer confidence for big-ticket purchases pegged back unexpectedly this month as analysts said "the cost-of-living crisis is still a day-to-day reality." GfK's Major Purchase Index, which c overs c onsumer items such as furniture , flooring and appliances, is down one point to minus 26 – two points lower than this month last year and negating a two-point improvement in April. The set-back is against the trend of a general improvement in consumer confidence reported by GfK which increased two points in May to minus 17. Their index measuring sentiment regarding personal finances during the last year is up one point at minus 10, ten points better than May 2023 The GkK Savings Index increased one point to +27 in May – eight points up on this time last year. Joe Staton, Client Strategy Director, GfK, says: “There was another strong showing for the UK Consumer Confidence Index this month, driven by a jump in the outlook for our personal finances and a boost for our view on the wider economy in the coming year. The only negative in May is the slight dip in our major purchase measure (down one point to minus 26), reinforcing the fact that the cost-of-living crisis is still a day-to-day reality for all of us. “However, with the latest drop in headline inflation and the prospect of interest rate cuts in due course, the trend is certainly positive after a long period of stasis which has seen the Overall Index Score stuck in the doldrums. All in all, consumers are clearly sensing that conditions are improving. This good result anticipates further growth in confidence in the months to come , ” he said.
Flooring retail price inflation has finally fallen below 2% after a long period of stubbornly high prices in the sector. According to the latest data from the Office for National for National Statistics (ONS), c arpets and other floorcoverings prices rose 1.7% in April , down from a 2.5% rise the previous month. This time last year, flooring prices were rising by 9% and this trend continued over the winter. Even wiith this fall, flooring is still bucking the trend for the furnishing sector which has seen deflation in recent months. Furniture and furnishing prices fell by 3.1% in April, down further from a decline of 2.3% in March. Overall, the Consumer Prices Index (CPI) rose by 2.3% in the 12 months to April 2024, down from 3.2% in the 12 months to March. On a monthly basis, CPI rose by 0.3% in April 2024, compared with a rise of 1.2% in April 2023.
Leading UK wool yarn spinner Lawton Yarns has "secured its viability" against demanding market conditions despite a drop in sales and falling into loss in 2023. Lawton is the major source of wool yarn for many UK carpet manufacturers and in its latest filed accounts for the year ended 30 September 2023, total sales fell 2.9% with UK revenues flat and exports nearly halved. As a result, the company's losses amounted ot £231,000 compared to a profit of £83,000 in 2022. Directors cited cost pressures including utility charges, interest rates and the rise in the National Minimum Wage but added “in the face of these pressures, price increase and continued customer loyalty has enabled the directors to secure volume to preserve viability. This strategy saw turnover stable at £32.7m with improved productivity increasing gross margin 11% (2022- 9.8%)." Originally a family-owned business, Lawton Yarns experienced a turbulent period in 2019 which saw its parent group enter insolvency. The yarn manufacturer was later acquired by Breal Capital in 2020. In 2022, the West Yorkshire-based business returned to private ownership following a management buy-out based on a £13.4m facility from Secure Trust Bank Commercial Finance . www.lawtonyarns.com
Flooring imports into the UK fell 7% in the first three months of 2024 compared to last year, revealing the sluggish demand in the sector in Q1. A ccording to HM Revenue & Customs data compiled by The Furnishing Report , carpet imports were down 11% for the quarter with steep declines from Belgium (down 16%) and from the Netherlands (down 29%). Wood flooring also saw a reduction of 7% and only vinyl was stable with 0.1% increase in imports during the quarter.
Flooring chain Carpetright is cutting around 70 jobs at its Essex headquarters, equating to more than 25% of head office staff. Reduction in roles in areas such as warehousing and IT will enable it to reduce its cost base by roughly £22m following a review by business advisers. Store numbers, services and deliveries will not be affected during the process, says the company. The 400-store chain has been seeking cost-cutting measures after a slowdown in demand for flooring and intense competition from rivals such as Tapi. "We've carefully examined our performance against operating costs, leading us to make difficult decisions to ensure the future success of our brand," said Kevin Barrett, CEO of Carpetright parent company Nestware Holdings. The retailer was forced to turn to a company volunta ry arrangement (CVA) in 2018 to exit under-performing shops and reduce rents but last month Carpetright said it was “not in plannin g” for another CV A. Underlying losses before tax for the the 14 months to January 1, 2022 were £23.4 million, an improvement on a previous loss of £53 million.
Flower power was at the centre of Adam Carpet’s presentation in Solihull with a fine bunch of chrysanthemums to welcome visitors and a unique story to tell about their impact on wool carpet performance. The flower heads of chrysanthemums kill bugs – specifically carpet moths. And only Adam has been able to harness their full potential with a “total insect protection” programme that saves wool fibre from attack. “This is a very big deal for Adam – putting us in a unique position to protect carpet from the increasing threat of damage by moth larvae which is an issue that is becoming more widespread in many more parts of the country,” says Chris Adam, managing director. At its factory in Kidderminster, Adam has its own dyehouse and colours all of its plain yarns itself. At the end of the process, they apply the insect protection treatment, based on nature’s own solution found in the chrysanthemum flowers.
The NICF has announced the fitters who will take part in the semi-finals laster thismonth, competiting for a place in September's grand final in Harrogate. The line-up for the semi-final which take place at the FITA Training Centre in Loughborough on June 25 and 26 are: Darren Ash - Alfrick Hayden Barr - Windermere Chris Farbrother - Stevenage Ryan Hughes - Luton Stephen Johnson - Liverpool Richard Long - Dundee Joni Reeves - Skipton Danny Thornley - Salford Steve Whitburn - Torquay Gareth Williams – Launceston The Stocklists, a sponsor of the competition, wish all the participants the best of success! There will be live streaming on UK Flooring TV at www.youtube.com/c/UKFlooringTV The final t akes p lace over 2 days at The Flooring Show in Harrogate Sunday 15th and Monday 16th September 2024. www.nicfltd.org.uk
The Campaign for Wool has announced that HM The King will remain as it’s Patron, supporting the Campaign and its educational activities and events to remind the world of wool’s support for the planet and its natural, renewable and biodegradable properties. The Campaign for Wool was HM King Charles’s personal initiative when he was The Prince of Wales in 2008 and was officially launched in 2010 in a bid to assist wool growers from throughout the Commonwealth to challenge the rise of toxic synthetic fibres in the worlds of fashion, interiors and the built environment. As Patron, over the past decade of the Campaign, the then Prince of Wales has visited numerous regions of the UK, Italy, Australia, New Zealand, Canada and South Africa to engage with wool growers on how best to explain the distinct environmental excellence and ecological benefits of wool in all its end uses. The Campaign fits perfectly with HM The King’s recently announced personal focus of Climate, Community, Commonwealth and Culture. Endorsing the natural benefits of wool Wool is more important today, moreover as climate change and plastic over consumption hits the headlines on a weekly basis, requesting all of us to be more considerate in our choices. The Patron has passionately endorsed the natural benefits and use of wool, issues he raised on the introduction of mainstream plastic use in his student days over 50 years ago. Choosing wool will help to safeguard the planet for future generations .The Campaign is supported by companies across the globe, including farmers, the wool processing pipeline, designers, brands and retailers. 2024 will see the Campaign launch some exciting initiatives and collaborations for Wool Month which takes place throughout October. www.campaignforwool.org
Abingdon Flooring has refreshed its competitive Stainfree Twist with a range of brand-new colours. One of the most affordable carpets in Abingdon Flooring’s Stainfree family, Twist is a popular choice for homeowners concerned with getting great value and a carpet that’s ready to take on life in family homes. With a Stainfree for Life guarantee, this easy clean carpet is considered the ‘original and best’ by many retailers. Now with a range of brand-new colours to suit the latest home interior styling, Stainfree Twist is ready to become the best for a whole new generation of carpet purchasers. Stainfree Twist’s refreshed palette includes pale neutrals, modern greys, earthy colours and rich hues ready to add a touch of style and comfort to every home. Charlotte Coop, head of marketing, Abingdon Flooring, says: “The original Stainfree carpet, Twist represents an affordable entry into quality stain-resistant carpet for the home. Offering great value and with all the performance needed for busy family homes, it’s easy to see why Twist continues to be such a key part of our Stainfree line-up.” Proudly made in Britain, Stainfree Twist comes with the additional benefit of a fleece backing that boosts underfoot comfort and improves thermal and acoustic insulation. The fleece also makes life easier for installers, adding stability and preventing marks to walls and skirtings. Equipped with a 10-year wear warranty, the 1/10th gauge twist pile can be used confidently in living areas, bedrooms, hallways, stairs and landings. In 2,5m, 4m and 5m widths, It’s a versatile performer available in a range of fabulous new colours sure to uplift any home. T 01274 655 694 • www.abingdonflooring.co.uk
More than 7,000 tonnes of waste vinyl flooring have been collected and recycled through Recofloor since the scheme was founded by Altro and Polyflor in 2009. Through the sustainable collection service for commercial waste vinyl flooring, material is recycled back into new flooring, as well as traffic management products. Recofloor is widely regarded as a great example of circularity in the flooring sector. To date, Recofloor’s collection of 7,060 tonnes has produced 8,282 tonnes of carbon savings – equivalent to taking 2,161 cars off the road for a year. It also equates to 2,353,000 square metres of vinyl flooring having been recycled. The carbon savings estimate is based on displacing concrete in traffic management products, the main application for the recycled flooring.
For some homes only the natural look of wool carpets will do. With the new Country Collection from Abingdon Flooring these very same homes can now choose the practicality of Stainfree carpets too. Using a special yarn that combines a matt lustre with a Berber fleck, the Country Collection has all the look of a natural wool yarn but with the bleach-cleanable practicality and lifetime stain warranty that comes with Abingdon Flooring’s Stainfree carpet family. To create its classic country living feel, Abingdon Flooring’s designers have created three textured loop designs for the new collection. Linear, Herringbone and Weave designs capture the charm and rustic texture of chunky wool loop carpets, adding sophisticated detail with subtle textured patterns. Each carpet comes in a range of ‘undyed’ beige tones and restful neutral grey hues like Elephant. Charlotte Coop, head of marketing, Abingdon Flooring: “The Country Collection is really a first for Abingdon Flooring and shows just how versatile our Stainfree yarn can be. These chunky loop pile carpets really do look every bit as good as their wool counterparts but are bleached cleanable and more affordable. What’s more, the Berber fleck is also great at covering up dust and dirt between vacuuming.” Manufactured by Abingdon Flooring, with a 10-year warranty, the Country Collection features its signature fleece backing, enhancing underfoot comfort, warmth, and sound reduction. Proudly made in Britain, the Stainfree Country Collection is available in widths of 2.5m, 4m, and 5m, offering versatility to suit any space. T 01274 655 694 • www.abingdonflooring.co.uk