Low consumer confidence dents DFS interim profits

In the 26 weeks to 29 December 2019, underlying pre-tax profit fell 17.5% from the first half of 2018 to £20.5m, with gross sales down 5.8% at £629.7m and revenue 5.7% lower at £488m. DFS said its year-on-year performance was compounded by "challenging" market conditions, with consumer confidence and political uncertainty impacting footfall.

Gross sales in the online division were up 4.5% to £117m.

Net debt remained broadly flat year-on-year and the company declared an interim dividend of 3.7p a share, in line with the previous year.

Chief executive officer Tim Stacey said that given uncertainty as to how the current Covid-19 situation will develop, the company is unable to give guidance "with any certainty" for the full-year out-turn.

"At present we believe our supply chain position should normalise before the financial year end, and it is only in very recent days that we have observed any change in consumer footfall to our showrooms," he said.

"While any disruption to order intake over the key trading periods of Easter and the May Bank Holidays is likely to impact our financial year 2020 results, it is reasonable to believe this may ultimately be transitory in nature; following periods of subdued demand we typically see much of that latent demand returning."

At 0910 GMT, the shares were down 4.1% at 200.50p.