Headlam taking action to return to profitability
Floor coverings distributor Headlam Group Plc said on Tuesday that it is taking action to eliminate loss-making revenues and consolidate operations, but doesn't expect to return to profitability until 2027.
The company announced last week that it had kickstarted a programme of "restructuring, cost reduction and operational improvements" after a period of underperformance, saying that full-year results would be below expectations.
Revenues fell 5% year-on-year over the four months to 31 October, following a 3.8% decline in the first six months of the year.
As a result, Headlam said it was taking a number of measures to shore up its financial performance, including refocusing on indie retailers and contractors while eliminating loss-making revenues; consolidating purchases; reducing footprint, improving stock turn; and reducing SKUs.
"The board believes that delivering successfully upon these actions will return the group to profitability and provide a sustainable financial position," the company said.
However, the company's projections don't predict a return to profitability until 2027, following a £19.9m underlying loss before tax recorded in the first half of 2025.
The company last reported an annual profit in 2023, when it made an underlying pre-tax profit of £11m, before swinging to an underlying pre-tax loss of £34m in 2024.
The stock, which has fallen by nearly two thirds so far this year, was up 4% at 53.01p by 1222 GMT.
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