ScS backs FY guidance as interim losses narrow

In the 26 weeks to 28 January 2023, underlying pre-tax losses narrowed to £4.7m from £5.6m in the same period a year earlier, as revenue rose to £147.9m from £144.2m. The loss before tax widened to £6.3m from £3.6m.

ScS said this was "typical of H1 performance, which includes significant marketing expenditure to support the winter sale and where profitability is substantially H2 weighted".

The company said like-for-like order intake momentum improved significantly throughout the period, but particularly through the key winter sale, as it started the period with tough comparatives.

For the first 16 weeks, LFL order intake was down 9.1% due to the comparative period benefitting from strong pent-up demand following lockdown. However, the subsequent 10 weeks to 28 January saw a return to order intake growth of 2.6%, which included the key winter sale.

Overall, LFL order intake was down 4.7% for the first half, mainly due to the "challenging comparative", but ScS said this wax partially mitigated by an improved underlying performance.

ScS said it remains on track to deliver full-year pre-tax profit in line with market expectations.

Chief executive Steve Carson said: "The group made good strategic progress in the first six months of the financial year and continued to take market share. We are pleased with the strength of our winter sale performance and the subsequent increase in order momentum over the last two months.

"The macroeconomic environment continues to be challenging and we are mindful of the pressures faced by many of our customers. Therefore, continuing to focus on our value driven proposition is more important than ever so that everyone is able to create the home they love."