Topps Tiles warned of significant cost pressures amid the Autumn Budget, reporting nearly halved underlying pre-tax profits of £6.3 million as store sales slumped 9.1%. The Chancellor's decision to raise the minimum wage and increase employer national insurance contributions is expected to add an additional £6 million to their wage bill, prompting the retailer to formulate plans to carefully manage these substantial cost increases.
The company acknowledged, 'There remain significant inflationary challenges facing the business in 2024-25.' They emphasized that rising wage and national insurance costs represent a high proportion of their current profitability. Plans are being put in place to mitigate these issues as per the ongoing economic climate.
Moreover, Topps Tiles noted, 'Whilst some macroeconomic indicators suggest a more favourable outlook into 2024-25, overall there remains significant uncertainty around the timing of any recovery.' They cautioned that weak consumer confidence and relatively high interest rates continue to pose challenges for business recovery.
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