Topps Tiles — Strategy and self-help supporting profit

Topps Tiles (LSE: TPT)

Last close As at 05/08/2026

GBP0.36

1.90 (5.56%)

Market capitalisation

GBP71m

More on this equity

Research: Consumer

Topps Tiles — Strategy and self-help supporting profit

Topps Tiles’ (TPT’s) H126 results show good progress on all strategic initiatives, which have contributed to further market outperformance, as well as on improving profitability. Trade revenue growth continues to outpace retail, driven by continued strong growth by Pro Tiler Tools, and new initiatives such as the credit offering have been well received. Digital growth has been boosted by new customer relationship management capabilities. Category extensions and a focus on better sales conversion have helped deliver market outperformance. With respect to acquisitions, Fired Earth is performing ahead of expectations and is already profitable, and CTD Tiles is on track to be profitable in H226. In response to the weaker-than-expected Q226 revenue, management has implemented three self-help cost initiatives: network rationalisation; a more flexible labour model in stores; and reducing head office and central functions. These initiatives support our estimates.

Written by

Russell Pointon

Director of Content, Consumer and Media

Retail

H126 results

19 May 2026

Price 34.00p
Market cap £67m

Net cash/(debt) at 28 March 2026 (excluding IFRS 16 liabilities of £99.1m)

£(3.1)m

Shares in issue

196.7m
Free float 70.2%
Code TPT
Primary exchange LSE
Secondary exchange N/A
Price Performance
% 1m 3m 12m
Abs (8.8) (23.6) 9.8
52-week high/low 48.0p 31.0p

Business description

Topps Tiles is the market-leading specialist retailer/distributor of wall and floor tiles, and associated products such as tools, grouts and adhesives, to its retail, trade and commercial customers in the UK.

Next events

Q326 trading update

1 July 2026

FY26 trading update

1 October 2026

Analysts

Russell Pointon
+44 (0)20 3077 5700
Chloe Wong
+44 (0)20 3077 5700

Topps Tiles is a research client of Edison Investment Research Limited

Note: Profit and earnings are company’s adjusted definition. FY24 and FY25 PBT and EPS exclude CTD Tiles.

Year end Revenue (£m) PBT (£m) EPS (p) DPS (p) P/E (x) Yield (%)
9/24 251.8 6.3 2.39 2.40 14.2 7.1
9/25 295.8 9.2 3.43 2.90 9.9 8.5
9/26e 299.0 9.0 3.61 2.90 9.4 8.5
9/27e 310.0 11.9 4.39 3.00 7.8 8.8

Good profit progress in a challenging market

To give a better indication of underlying performance following the acquisition of CTD, TPT has provided pro forma figures, which we focus on here, as well as the typical adjusted and statutory numbers. There is a clear message of good progress, with adjusted pro forma gross profit increasing 2.9% to £75.6m and adjusted pro forma operating profit increasing 17.3% to £6.1m despite the marginal 0.2% decline in revenue. In absolute terms, gross profit increased by £2.1m and adjusted operating profit increased by £0.9m, highlighting good management of operating costs despite inflationary headwinds. The closing adjusted net debt position of £3.1m is a decline of £10.5m from the end FY25 net cash position of £7.4m, and compares with H125 net debt of £1.2m. This reflects the typical seasonal working capital outflow as well as the payment for the acquisition of Fired Earth.

No changes to estimates

Following the relatively weaker trading in Q226, Topps Tiles stores have seen a more positive trend with like-for-like sales growth of 0.6% in the first seven weeks of H226, and CTD has made good progress with 3% like-for-like growth. Online continues to see good growth. In addition to the typical H2 weighting of profitability and the continuation of the positive drivers delivered in H126, TPT should begin to see the benefits of the trade app that was launched in May 2026, as well as the three self-help cost initiatives, which management expects will contribute c £3m of savings and c £6m on an annualised basis.

Valuation

TPT’s prospective EV/sales multiple of 0.23x remains at the low end of its historical multiples.

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This report has been commissioned by Topps Tiles and prepared and issued by Edison, in consideration of a fee payable by Topps Tiles. Edison Investment Research standard fees are £60,000 pa for the production and broad dissemination of a detailed note (Outlook) following by regular (typically quarterly) update notes. Fees are paid upfront in cash without recourse. Edison may seek additional fees for the provision of roadshows and related IR services for the client but does not get remunerated for any investment banking services. We never take payment in stock, options or warrants for any of our services.

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