DIY shares fall on retail gloom
Published: 05 August, 2010
LONDON: Shares in retailers including DIY outlets lost ground yesterday on warnings of a retail slowdown by Carpetright, Britain's biggest floor coverings chain and Next, the second-largest fashion chain.
Carpetright reported a drop in underlying sales and said it was planning for spending to stay subdued for the rest of 2010 while Next said it expected a "noticeable cooling of demand" among shoppers to deepen.
Carpetright said sales at British and Irish stores open at least a year fell 3.4% in the 13 weeks to 31 July, compared with a 1.5% rise the previous quarter.
Philip Harris, chairman and chief executive, who regards Carpetright as a business that tends to be "first in, first out" of a recession. We remain cautious about the outlook for consumer spending for the balance of the year", he said.
Greg Lawless, analyst with broker Collins Stewart said: "The outlook for the high street retailers is not good given the forthcoming VAT rise, and cost price inflation…which will put further pressure on already subdued consumer demand."