DFS Furniture’s profits set to be ‘broadly in line’ with expectations despite challenging trading environment

DFS Furniture today said its full year profit before tax is expected to be broadly in line with market expectations despite a challenging trading environment.

DFS has published a trading update

DFS Furniture plc has published a trading update for the 26 week period to December 29 2019.

The company said gross sales were 6 per cent down on the “strong comparative period” and reflected a challenging consumer environment, particularly in August and September.

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The company said that order intake momentum had strengthened more recently, and the key winter sale trading period had started satisfactorily.

In a trading overview, the company said: “Gross sales declined by 6 per cent measured against the comparable twenty-six week period ending December 30 2018. This performance reflects the challenging market environment impacting footfall and the performance in the strong prior year period that was driven by latent demand and a higher opening order bank.

“We expect that full-year profit before tax and brand amortisation will be broadly in line with market expectations, subject to achieving the low single digit revenue growth that we assume in our plan. Our expected revenue growth is supported by recent trading momentum and the benefit of opening a number of new group showrooms during the first half.

“We are mindful of the broader political and economic uncertainty that still exists. However, we have made good progress on our strategic initiatives, driving showroom conversion and online growth. Furthermore, we have appropriate cost saving actions in place to help mitigate continued market weakness.

“It is worth reiterating that the group has historically capitalised on adverse trading conditions to build our market position and we continue to believe that our cash generation and long-term growth prospects will drive attractive returns for our shareholders.

“The group will announce its interim results for the period ending December 29 2019 on March 10 2020.”