Veteran retailer Lord Harris of Peckham made a dramatic return today to the helm of the Carpetright empire he founded 25 years ago.
The Tory peer, who has been in the carpet trade for more than 50 years, resumed day-to-day running of the firm after chief executive Darren Shapland left the business in the wake of a shock profits warning.
Lord Harris, who was formerly non-executive chairman, described trading conditions in the UK as volatile, with like-for-like sales down by 2.5% in the 10 weeks to September 29.
Lowering expectations for group profits in the year to April, Lord Harris said conditions experienced by its business in the Netherlands were also "extremely difficult".
Shares slid by 10% today as the update dashed hopes in the City that better conditions in the property market were benefiting Carpetright.
The company was founded in 1988 with a single outlet in Canning Town, east London, and was floated on the London Stock Exchange five years later. It now trades from 616 stores, including 474 in the UK and 95 in the Netherlands.
Executive chairman Lord Harris will run the business with Graham Harris, who is currently trading director but will step up to the role of chief operating officer.
Mr Shapland joined Carpetright from Sainsbury's 17 months ago and oversaw a programme of store refurbishments, improved product ranges and increased digital marketing.
Until recently, like-for-like sales were on a positive trend, with annual profits more than double the previous year at £9.7 million.
N+1 Singer analyst Matthew McEachran said today's warning came as a "huge surprise", particularly as a CBI survey said furniture and carpet retailers led the retail sector's best month since June 2012.
He expects that City profit forecasts will fall to around £10 million for this year, compared with £62 million in 2008.
Lord Harris said: "I am enthusiastic about tackling the challenges that the business continues to face in these difficult economic times and pleased that Graham Harris will be working alongside me as chief operating officer."
Lord Harris indicated that Mr Shapland left the company because he was not able to commit for a five-year term as previously thought.
He added: "I am disappointed that Darren Shapland, who has made a significant contribution to Carpetright over the last 17 months, is leaving the business, but he does so with our thanks and we wish him well for the future."