DFS achieves record market share
Furniture retailer DFS has said it achieved a record market share of 38% in the year to 25 June.
In a trading update, the retailer said underlying pre-tax profit in the period was in line with previous guidance at slightly above £30 million, despite the furniture market being “significantly worse” than expected.
In addition, there was an improvement in gross margin rate due to freight costs returning to pre-pandemic levels and effective cost control.
However gross sales were down 4% year-on-year, but up 15% compared to pre-pandemic levels.
DFS said trading at the start of the new financial year has been in line with expectations, although it anticipates that market volumes will decline by mid-single digits for the full year.
Despite the ongoing pressure on market volumes, it expects underlying profit in the year to be slightly above FY23 levels. It also said that it remains confident in delivering it long-term targets of £1.4 billion of revenue, an 8% pre-tax profit margin and 75% post tax free cash conversion.
DFS chief executive Tim Stacey said: “I would like to take this opportunity to thank every one of our colleagues and partners for their commitment, hard work and dedication as we trade through the increasingly challenging market conditions.
“We are in the strongest position we have ever been as a Group in terms of market share, and when the market recovers, we will be well placed to deliver our strategy and grow our earnings and cash flows towards our longer term plan.”
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