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UPDATE 2-Carpetright profit slumps 72%, slashes dividend

Published 06/30/2009, 02:53 AM
Updated 06/30/2009, 02:56 AM
CPRC
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* FY underlying pretax profit 17.2 mln stg vs f'cst 18 mln

* Revenue down 7.4 pct to 482.8 mln stg

* Final div cut to 4p vs 30p

* Year-end net debt 97.1 mln stg

* Says cautious about short-term prospects

(Adds detail throughout)

By James Davey

LONDON, June 30 (Reuters) - Britain's biggest carpet retailer Carpetright Plc posted a 72 percent slump in full-year profit on Tuesday, slashed its dividend, and said normal trading wouldn't resume for at least 12 months.

"We remain cautious about short-term prospects but are confident that the investments we have made in our stores, ranges, services, cutting and distribution centre and IT systems will support future growth," the company said on Tuesday.

The 695-store group, which trades in the UK, Ireland, the Netherlands, Belgium and Poland, made an underlying pretax profit of 17.2 million pounds ($28.3 million) in the year to May 2.

This compares with analysts' consensus forecast of 18 million pounds, according to Reuters Estimates, and with 62.1 million pounds in the previous year. Total revenue fell 7.4 percent to 482.8 million pounds, with like-for-like sales down 13.5 percent in the main UK and Ireland division.

"I expected my 51st year of selling carpets to be extremely challenging, and it has proved to be the case. Market conditions and consumer confidence declined throughout the year," said chairman and chief executive Philip Harris.

He said he did not expect a return to more normal trading conditions for at least 12 months.

The group, which ended the year with net debt of 97.1 million pounds, cut its final dividend to 4 pence from 30 pence last time, making 8 pence for the year, down from 52 pence.

Shares in Carpetright have lost 16 percent of their value over the past year but have gained 45 percent over the last three months, outperforming the FTSE All Share General Retailers Index by 22 percent.

The stock closed on Monday at 592 pence, valuing the business at 398 million pounds. (Reporting by James Davey; editing by Mark Potter/Will Waterman)

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