DFS on track to deliver full year profit performance ahead of expectations

The group’s underlying profit before tax and brand amortisation for the half year ended December 29 2024 increased by £8.3m to £17.0m. Reported profits also rose by £14.9m to £15.8m.

DFS said the increase in underlying profits was predominantly driven by the sustainable cost reductions the group is delivering through its £50m “cost to operate” saving programme, with operating costs reducing year on year.

Commenting on the results, Tim Stacey, Group Chief Executive Officer, said: “Our improved profit performance in the first half is testament to the strength of our customer proposition, the dedication of our colleagues and our collective focus on operational excellence, evidenced through increased market shares and customer satisfaction scores.

“We are on track to deliver full year profit performance ahead of market expectations and our confidence in the group's capabilities and future potential has never been higher.

He added: "Given our strong market position and relentless focus on executing our strategy, we are confident that we will achieve our £1.4bn full year revenue and 8 per cent PBT (profit before tax) targets in the medium term and deliver strong returns for our shareholders.”

In a statement to accompany the results, DFS said it had continued to relentlessly focus on three key areas; profitably growing market share, improving gross margins and reducing its cost base.

It added: “Our market share has strengthened further as a result of both improved customer service and product innovation, driving our customer net promoter scores to record levels and supporting good top line sales order growth of over 10 per cent.”

The statement added: “Our two retail brands, DFS and Sofology, appeal to different customer demographics and allow us to target the majority of the UK sofa market.

"Both traded well in the period and our proprietary banking data indicates we continued to grow our market share across both brands.

It continued: “DFS and Sofology have good national coverage with their well invested showroom estates along with strong websites enabling customers to research and transact in the channels that suit them.”

The DFS business was founded in 1969 by Graham Kirkham from a single store near Doncaster, trading as Northern Upholstery.

The business grew by acquiring additional manufacturing facilities around Doncaster, and, in 1983, Northern Upholstery bought the assets of DFS Furniture.

By 2003, DFS had grown to become the largest retailer in the UK upholstery market. In 2017, DFS acquired Sofology, the third largest retailer of sofas in the UK as the fourth addition to the DFS Group portfolio to increase its market share.