Profits at DFS shoot up as retailer grabs market share
DFS has swung back to profit as demand for home furniture has recovered.
Share in the sofa retailer rose more than 13 per cent in early trades.
The company told markets this morning that underlying profit before tax nearly doubled to £17m in the 26 weeks to December 29, up from £8.7m last year.
However, gross sales in the first half of this year rose 1.4 per cent, from £666.2m to £675.6m, while order intake grew 10.1 per cent after falling 1.1 per cent last year.
“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,” CEO Tim Stacey said.
“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.
“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 profit-before-tax targets in the medium term and deliver strong returns for our shareholders.,” he added.
The company said that trading through the first 10 weeks of the second half of the year has “remained strong”, with order intake now up 11 per cent year on year.
As a result of higher demand and “good cost control”, the company expects to outperform consensus expectations and deliver underlying profit before tax of £25-£29m this year.
Longer term, the board expects to achieve £1.4bn in full year revenue.