Furniture seller DFS has reported strong interim sales causing shares to climb 8.26 per cent despite warnings of a challenging business environment.
The retailer has started the year in a strong position with its order bank up £200m compared to pre-pandemic levels according to a trading update for the half year to December 2021. Gross sales are up by ten per cent compared to the same period in 2019, but was two per cent lower than in 2020 suggesting that an explosion of interest in home improvement seen during lockdown is starting to cool.
“While the market remains hard to predict, we believe our scale, brand strength and integrated retail strategy will allow us to drive market share gains ahead of the competition,” said chief executive Tim Stacey.
DFS noted that the company had been buffeted by Covid-related absences and supply chain disruption in the second half of 2021. Despite challenges gross sales jumped by 23 per cent in the second quarter of the period compared to the first as orders gained momentum.
“Looking ahead we will continue to invest in our digital platforms and our showrooms, our delivery network, our UK manufacturing capacity, and with expansion into other home categories, we are well positioned to succeed,” Stacey added.
Closing net bank debt excluding lease liabilities is expected to be between £65-70m at the end of the half year, up from £19m of net bank debt reported at the end of the previous financial period. Profit expectations for the full year remain unchanged with detailed interim results due to be published in March.