DFS: Yorkshire-based furniture firm in “great shape” as profits set to land above guidance
Yorkshire-based furniture firm DFS has said it is in “great shape” as the company announced that its profits are set to land above the top end of its guidance.
DFS said it expects to post pre-tax profit slightly above the top end of its £25m to £29m guidance for the year ending 29 June, up by around £20m year-on-year.
The Doncaster-based firm said its “strong” trading in the first half of the year had continued into the second half, with group order intake up 10 per cent year-on-year in both halves.
DFS said this demonstrated “significant outperformance” of the market, which it said “remains subdued”.
Tim Stacey, group chief executive at DFS, said: "We are pleased to report that we expect profit for the full year to be slightly above the top end of our guidance.
“Our excellent first half performance set the foundation for our success, with strong trading through the rest of the year with both our DFS and Sofology brands outperforming the market.
“We have continued to maintain a strong focus on disciplined cost management and improved our gross margins, leading to significant year on year profit growth. In addition, cash flow was healthy and our balance sheet is strengthening as we progress towards our target leverage range.
“Whilst the macro environment remains challenging our business is in great shape and I would like to thank our amazing colleagues for their support and commitment as we relentlessly focus on delivering against our strategy together.”
DFS announced that its gross sales were also up 5.8 per cent year-on-year.
The firm’s net bank debt, excluding capitalised leases, reduced during the period to around £107m, down from £165m the year prior.
Mr Stacey added: “Looking forward, we are confident that the Group is well positioned to drive attractive returns for shareholders as the market recovers and we remain focused on delivering our medium term ambition of £1.4bn revenue and eight per cent profit before tax margins."
The firm said that both its DFS and Sofology brands had “performed well” with order intake up 8.7 per cent for DFS and 16.2 per cent for Sofology.
The company said this was due to "successful implementation” of its growth initiatives.
It added that its proprietary data showed that it had grown its market share in the specialist upholstery sector, during a period where the market had remained subdued.
The results come after DFS warned in January of a “less positive market outlook” for 2025.
The firm said in January that it expected to see an increase in costs this year, in part due to changes announced in last year’s October Budget, when Chancellor Rachel Reeves announced a rise in national insurance contributions for employers and an increase in the minimum wage.
DFS is set to announce its full year results for the period ending 29 June 2025 on 25 September 2025.
According to the latest data from the Office for National Statistics, retail sales volumes as a whole are estimated to have fallen by 27 per cent in May of this year, following a rise of 1.3 per cent in April.
Volumes were down by 2.7 per cent compared with pre covid 19 levels in February 2020, reaching the lowest level since December of 2024.
Retailers told the Office for National Statistics that the lower sales in May had been in part caused by reduced footfall and consumers having completed home projects earlier than usual in 2025, due to the good weather.