Topps Tiles has announced a rights issue in which it will place more than 17m shares at 3.3p each in the company's capital, in the face of across-the-board declines in its full year figures.


The 12 months to September 26 saw total group revenue drop 10.6% to £186.1m - a 13.5% decline in like-for-like terms. Gross margin fell 3.5% to 58.3% and operating profit halved from £34.6m in 2008 to £16.4m. The store portfolio contracted from 320 stores to 309 and the company disposed of two freehold properties with a loss on disposal of £0.3m.

However, sales for the first seven weeks of the new financial year have seen some improvement, with like-for-like sales up 2.2% on the same period last year.

The board took the decision to launch the rights issue as "a precautionary step in the event of a further downturn in consumer confidence and spending, but will also give us additional resources to support the company's growth strategy as opportunities arise in the market," said a company statement.

Commenting on the full year results, chief exec Matthew Williams said: "The retail environment continues to be challenging and the outlook for consumer confidence remains uncertain. Against this context we are pleased to have delivered a performance that is in line with both management and market expectations and demonstrates the resilience of the business model with the continuing generation of both profit and free cashflow. Furthermore, our current trading performance indicates that signs of stability are returning."

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