UK's Carpetright says market tougher, shares tumble

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LONDON, April 25 (Reuters) - Carpetright (Other OTC: CGHXF - news) forecast full-year profit at the lower end of market expectations on Tuesday as quarterly sales growth slowed at Britain's largest floor coverings retailer, adding to evidence of deteriorating UK consumer confidence.

Carpetright said sales at UK stores open over a year rose 1.4 percent in the 12 weeks to April 22 - slowing from third-quarter growth of 1.9 percent.

"In common with other retailers in the home improvement sector in the UK we have experienced tougher trading conditions over the last three months," said Chief Executive Wilf Walsh.

"Whilst we remain confident in our turnaround plan, the level of sales growth in our final quarter leads us to expect that full-year profits will be towards the lower end of the current range."

Shares (Berlin: DI6.BE - news) in Carpetright were down 10 percent in early trade.

Analysts' forecasts for underlying pretax profit for the year to April 29 range from 13.9 million to 16.2 million pounds ($17.8-$20.7 million), down from 17.3 million a year earlier.

Carpetright's fortunes are tied to the strength of the UK housing market and the firm is regarded as a useful economic indicator as traditionally it has been "first in, first out" of a recession.

British retail sales posted their biggest quarterly fall in seven years in the first three months of 2017, hurt by rising prices since last year's Brexit vote.

Carpetright said like-for-like sales in its Rest of Europe division (Netherlands, Belgium and Ireland (Other OTC: IRLD - news) ) rose 1.4 percent, underpinned by a continuing recovery in economic confidence, particularly in the Netherlands.

($1 = 0.7816 pounds) (Reporting by James Davey; editing by Kate Holton and Jason Neely)