DFS cuts sales and profits targets for the year after demand 'weakened significantly'

DFS told shareholders on Tuesday morning that demand slowed after a strong start to January.

As a result, it said, order volumes dropped 16 per cent year on year across January and February.

The retailer said it is now on track for revenues of between £1bn and £1.015bn for its financial year to the end of June, cutting its previous guidance by up to £65m.

It said profits are also now on track to be £10m lower than previously predicted, with new guidance of £20m to £25m in pre-tax profits for the year.

However, it added that this is before the potential impact of further disruption to products being shipped through the Red Sea.

It said continued delays could push back a further £4m from this year’s profits to next year.

DFS said it also remains “cautious” about consumer confidence improving.

It came as the company revealed that revenues declined by 7.2 per cent to £505.1m for the six months to December 24.

Group chief executive Tim Stacey said: “I want to thank our colleagues for their dedication toward providing a first-class service to our customers.”

He added that DFS was pleased to have extended its market leadership.