DFS sales bolstered by soaring online business

DFS has announced that sales were up by 19% in the half-year ended 13 December 2020, while online sales soared by 76% against the prior year. 

In its latest pre-close trading update, the furniture retailer said its order bank “remains strong”, and is currently £200m higher year-on-year on a revenue basis, providing “future resilience” for the group. 

According to the retailer, its latest results reflect a shift in spending to home categories, which led to a “particularly strong” order intake in Q1 and a “resilient” Q2 to date, despite extensive showroom closures in November’s lockdown.

Order intake in its second quarter was only down by 5% year-on-year, despite the impact of showroom closures in the period.

Based upon “cautious” order intake assumptions, the group now expects its full-year pre-tax profit to be “within the upper half of the current market forecast range”, subject to the extent of enforced showroom closures.

Its closing net debt is also expected to be between £40 to £50m, a reduction over the 26 weeks of over £115m.

In addition, DFS said it has made preparations in case of a no trade deal between the UK and EU, adding that under WTO terms, there are no tariffs applicable to its upholstered finished goods.  

It added it has “prudently planned” for the risk of an exacerbation of current port congestion and delays. 

CEO Tim Stacey said: “I want to thank every colleague in our group for their resilience, spirit and determination to overcome the many and varied operational challenges that we have faced since reopening our business after the first lockdown. 

“We are working all hours focusing on what we can control to look after our people and our customers. I want to thank our customers for their patience given the ongoing disruption to our deliveries due to port congestion and raw material shortages, as well as apologise to those that have experienced delays.” 

He added: “While the current environment is clearly unpredictable, our business model is resilient and we are well set for medium term growth.”