Good performance for DFS despite slow sales growth

Retailer DFS Furniture said gross sales for the group for the financial year to date are up 7 per cent on the prior year.

DFS store

The group has continued to deliver a good performance through the second half, gross sales in the second half to date are up 4 per cent. This slight reduction in growth rate in the second half reflects the more demanding comparatives and the extra trading week last year, DFS said.

Sofa Workshop and Dwell have both continued their recovery in performance since acquisition by the DFS and have made a positive contribution to sales growth, contributing c. 1 per cent point to group growth both in the second half and full year to date. However, due to their scale and stage of turnaround, their profit contribution to the group is limited.

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The board expects the group to deliver a record performance for the full year with underlying results within the current range of market expectations, given the strength of second half trading to date.

DFS opened its first store outside of the UK and Ireland at Cruquius in The Netherlands in November 2014. After a psoitive reaction, reflected in an encouraging trading performance. The board has decided to expand the DFS presence in The Netherlands and is aiming to open two further stores in the coming year. This investment in future growth is expected to lead to an increase in operating costs net of incremental revenue in The Netherlands of £2-3m in the financial year 2015/16.

Jon Massey has informed the Group that he wishes to retire from his current position as chief operating officer in Autumn 2015. But he will remain in an advisory capacity.

Doncaster-based ​DFS, which is majority-owned by private equity firm Advent International, has a quarter share of Britain’s ​£3bn upholstered furniture market.

It has 105 stores in the UK,​ ​Ireland and the Netherlands, mainly on retail parks and earlier this year made its debut on the London Stock Exchange.