Lockdowns lead to bumper profits at DFS Furniture as people stay at home

Sofa specialist DFS Furniture has announced bumper half year results as more people lavished money on their living rooms during lockdown periods when they were forced to stay at home.

More people lavished money on their living rooms during lockdown periods

The Doncaster-based firm said revenue jumped 17 per cent to £573m in the six months to December 29 as a result of pent-up demand from 'lockdown one', market share gains and a shift in consumer spending to the home.

The group reported a resilient trading performance through recent lockdown periods, despite showrooms being closed. Online revenues leapt 66 per cent year-on-year.

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Underlying pre-tax profits rose £60m to £77m, primarily as a result of the strong revenue growth.

The firm's order bank is currently over £65m higher in revenue terms than the prior year, with a £200m higher order bank at Christmas-time providing resilience through the still ongoing retail lockdown.

The group's market share rose by 2 per cent over the half year, extending its clear market leadership. As showrooms reopen, it will target further market share gains.

DFS said it has made strong strategic progress despite the operational challenges of the pandemic, port disruption and the supply of raw materials.

Tim Stacey, group chief executive, said: "This strong first half profit and cash flow performance is a true reflection of the supreme efforts put in by our teams right across the group since the start of the pandemic. I am hugely grateful to every colleague for their constant focus on the safety, health and wellbeing of all their colleagues and also our customers.

"Our business has proven to be resilient throughout the period, despite showroom closures and a significant amount of external disruption in our supply chains.

"The investments we've made in our digital channels have generated exceptional revenue growth. Consequently our order bank remains well above normal levels and, subject to showrooms reopening by April 12, our central planning scenario is for an expected full year profit before tax outcome of approximately £105m, with further benefits to be realised in next year's financial results."

Mr Stacey said DFS is committed to its strategy to lead sofa retailing in the digital age with its proven integrated retail model.

"We expect to see a good level of activity in the home market as Covid-19 restrictions ease and, having accelerated the execution of our strategy and grown our market share, we are well set for future growth," he added.