DFS Furniture plc reported a significant increase in profit despite a slight decline in revenue for the first half of its financial year. The UK-based furniture retailer saw its pre-tax profit rise to £15.8 million for the six months ending 29 December, up from approximately £900,000 the previous year. Underlying pre-tax profit nearly doubled to £17 million, while basic earnings per share surged from 0.2p to 5.1p.
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Revenue remained largely flat, edging down 0.1% to £504.5 million, though gross sales grew by 1.4% to £675.6 million. The company attributed its stable revenue to investments in interest-free credit offers, aimed at maximising cash gross margins amid a "challenging consumer landscape". Order intake improved by 10.1%, reversing a previous decline, which DFS linked to its "compelling customer proposition".
Chief Executive Officer Tim Stacey credited the improved performance to "the strength of our customer proposition, the dedication of our colleagues and our collective focus on operational excellence". Despite the profit increase, DFS opted not to declare an interim dividend, citing leverage that remains at 1.6 times, above its target range.
Looking ahead, the company raised its full-year forecast, now expecting underlying pre-tax profit between £25 million and £29 million. DFS stated this was driven by "continued strong trading, good cost control and assuming no further supply chain disruption". Stacey expressed confidence in meeting long-term targets of £1.4 billion in annual revenue and an 8% profit before tax margin, highlighting the firm's "strong market position".
Source: www.marketscreener.com