Furniture chain DFS said it was at its “strongest position since the pandemic” despite seeing a drop in revenues in the last year.
The Doncaster-based chain has released preliminary results for the year to the end of June which show that its revenues fell 5.3% to just under £1.1bn. The company said its sales were still above pre-pandemic levels and were returning to normal after a boom during the Covid outbreak and immediately after.
DFS said its margins had improved and it had also increased its market share in the Ƶ upholstery sector, though bank debt had risen significantly. It added that it had seen improvements in its operations, with supply chains, order banks and customer lead times all back to normal.
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Looking forward, DFS said it expected revenue improvement of between £30m and £35m, despite volumes being likely to fall by around 5%.
Group chief executive officer Tim Stacey said: “I want to sincerely thank our colleagues for their truly outstanding and consistently high level of determination and dedication to deliver at their best for the group, and for their help in getting us to the strongest position we have ever been in terms of market share.
“The group is operating in one of the toughest economic climates we have experienced. Whilst we are confident the upholstery market will recover, forecasting the specific timing and pace of the recovery is challenging.
“We do, however, expect to generate a modest year on year increase in profit before tax in FY24 despite a relatively weak market in which we expect volumes will continue to decline across the next 12 months. Looking to the future as market volumes recover, we remain confident in achieving the financial performance set out at our Capital Markets Day in 2022 of £1.4bn of revenues at an 8% PBT margin.”
In the results, DFS said it was moving into higher priced parts of the furniture market and now had 58 Sofology showrooms, close its target of 65-70. It also said that online bed and mattress sales were up 69% year-on-year thanks in part to a new delivery system.
