TOPPS Tiles yesterday issued a profit warning and said it does not expect to pay a dividend this year as it closes stores amid the spread of coronavirus.

The tile specialist said the pandemic will result in a "material reduction" to expectations for revenue and profit and is not expecting to pay an interim dividend this financial year.

Topps Tiles said like-for-like sales in its retail business for the 12 weeks to 21 March were down 3.1 per cent.

In a bid to shore up its financial position, Topps Tiles has drawn down its £39m revolving credit facility and the group has approximately £20m of cash liquidity available.

The group expects total net debt at the half year end on 28 March to be approximately £19m.

Topps Tiles stores are closed but its online business remains in operation following the UK's decision to tighten social distancing restrictions to prevent the spread of coronavirus.

In the event of a 12-week closure of retail premises, followed by a further quarter of materially reduced sales, the tile company said its cash reserves will "provide it with good levels of liquidity for the remainder of the current financial year".

The firm welcomed the chancellor's emergency measures for business, particularly the cessation of business rates. Topps also said it would utilise the job retention scheme to furlough store workers.

(c) 2020 City A.M., source Newspaper