DFS says it's on track for full year

Retailer DFS Furniture reiterated its expectations for the full year as it reported good sales growth and cash generation in the first half.

In the 26 weeks to 30 January, gross sales were up 7% on the same period the previous year.

The company said Sofa Workshop, Dwell and DFS Netherlands have all contributed encouragingly to overall group sales.

DFS said free cash flow was robust and its gearing ratio at the half year will be similar to the previous financial year at around 1.8x net debt/earnings before interest, taxes, depreciation amortisation, after the payment of the interim and full year dividends.

The group said its strategy – which includes a store expansion programme, continued development of its omnichannel proposition and enhancement of the product range – was delivering results.

DFS noted broadly stable general macroeconomic trends in the UK and said it was “in a strong position to sustain its record of sales growth, market share capture and cash generation”.

The company said cash generation will underpin the announcement of a progressive interim dividend, in line with the policy stated at the IPO last year.

“Based on the trading performance over the first half, our expectations for the group's financial performance in the full year remain unchanged.”

The company also announced the retirement of finance director Bill Barnes in the summer, after nearly 13 years.

Current commercial finance director Nicola Bancroft will become chief financial officer and an executive director from 1 August 2016.