ScS reports ‘good strategic progress’ despite losses in H1
The sofa retailer reported that its interim results are in line with expectations due t investments made in the first half of the year
Furniture retailer ScS has reported making “good strategic progress” in the first half of the year, despite its loss before tax falling to £6.3m in the period, down from a loss of £3.6m the prior year.
Nonetheless, its underlying loss before tax was £4.7m, down from a loss of £5.6m the prior year, with sales increasing by 3.4% following improvements across its supply chain.
Order intake increased by 2.6% for the 26 weeks period ended 28 January 2023, and revenues for the period rose by 3.7% to £147.9m, despite being adversely affected by a 4.5% increase in interest free credit fees.
The retailer has said that its losses over the period were in line with the group’s expectations “predominantly due to the investment in marketing in the first half of the financial year to support order intake over the key winter sale” and that the benefits of the investment will show in the second half of the year.
Earlier this year, ScS acquired sofa firm Snug for £875,000, a move which the company says will diversify its customer base and increase market share. The group is now planning to launch Snug concessions into its showrooms in the coming months.
For the year ahead, the company is planning further investments in eight stores, while remaining positive that the full year profit before tax will be in line with market expectations.
Steve Carson, chief executive officer of ScS, said: “The group made good strategic progress in the first six months of the financial year and continued to take market share.
We are pleased with the strength of our winter sale performance and the subsequent increase in order momentum over the last two months.
“The board continues to believe that progress with the group’s strategy, ongoing cost management and a robust balance sheet places it in a strong financial and operational position. The outlook, therefore, is positive and ScS remains on track to deliver full year profit before tax in line with market expectations.”