Carpetright shares drop 8% after profit warning

Floor coverings retailer Carpetright has warned that its annual profits will be lower than forecast after sales were hit by poor weather and weak consumer confidence.

Like-for-like sales, which ignore store openings and closures, fell 7.7% in the 13 weeks to 29 January in the UK and Irish Republic.

Carpetright said annual profits would be lower than current hopes of £26m.

The company's shares were down 8% in early trading.

Carpetright's chairman and chief executive, Lord Harris of Peckham, said: "Although we have achieved an increase in sales year on year since Christmas, this has not been at the level expected."

The company has been hit by a combination of factors.

Spending on high-value items for the home have been affected by a sluggish mortgage market and the poor availability of household credit, as well as the increase in VAT this year to 20%.

Lord Harris added that the business remained well placed to capitalise on opportunities when economic conditions improved.

Carpetright has 574 outlets in the UK and Irish Republic, and a further 120 in the Netherlands and Belgium.