Topps Tiles resumes dividend as profits surge on home improvement boom

(Reuters) -British tile retailer Topps Tiles on Tuesday resumed dividend payouts as full-year profit jumped more than four-fold despite supply chain pressures, helped by strong demand from people redoing their homes and cost cuts.

The company that focusses on renovation, maintenance and improvement of homes in the United Kingdom said it was facing challenges from global supply chain issues and cost inflation, with like-for-like retail sales in the first eight weeks of the new financial year falling 0.7% from a year earlier, though they remained 18.4% above 2019 level.

“While trading headwinds are likely to continue over the short term, we are confident in our strategy and our ability to deliver sustainable long term growth,” said Chief Executive Officer Rob Parker.

Topps Tiles has benefitted from a boom in the home improvement market since the start of the coronavirus pandemic, and while higher shipping costs have weighed on profit margins, it has invested in more inventory to avoid supply chain disruptions.

Britain eased most COVID restrictions in July after months of lockdown, but this week ordered the use of masks in retail settings to curb the spread of the new Omicron variant, which could spell trouble for businesses.

The company, which suspended dividend payments in March 2020, said it would pay a dividend of 3.1 pence.

Its adjusted profit before tax rose to 15.3 million pounds ($20.4 million) for the year ended Oct. 2, from 3.6 million pounds a year earlier.

($1 = 0.7509 pounds)

(Reporting by Amna Karimi and Yadarisa Shabong in Bengaluru; Editing by Milla Nissi)