DFS' sales boosted by Sofology acquisition

Helen Cahill
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DFS announced a sales rise this morning as it was boosted by its acquisition of Sofology.

The figures

Group sales increased four per cent over the 26 weeks to 27 January, however, excluding Sofology, sales fell 3.5 per cent year-on-year. The retailer did not provide a like-for-like sales figure, but said comparable sales were "strengthening" during the first half of the year.

Read more: DFS gets the all-clear for Sofology buyout

Over the period, DFS opened four new UK showrooms, and one showroom in the Netherlands.

At time of writing, DFS' share price was up three per cent at 197.4p.

Why it's interesting

DFS received the all-clear for its buyout of Sofology from the Competition and Markets Authority (CMA) in November, and it appears DFS is benefiting from the £25m takeover. The sales boost will be welcome given the tough trading environment for non-food retailers, with prices falling due to a squeeze on consumer spending. Underscoring the troubles faced by furniture retailers, Warren Evans fell into administration this week.

Neil Wilson, senior market analyst at ETX Capital, said the results showed DFS was "seeing off the competition".

"There is hope in there - management expects second-half trading to pick up considerably from a pretty lacklustre performance in the first half," he said.

"Although sales are nothing to shout about, this is a particularly tough market and one that DFS is probably better-placed to ride out than many peers."

What DFS said

The company said in a statement: "We recognise that the living room furniture retail market is likely to remain challenging in 2018, given current consumer confidence levels.

"However, with the benefits of strategic investments feeding through, our expectations for the full year are unchanged."

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