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DFS boosts liquidity with share issue

DFS manufacturing upholsteryDFS has raised £64m by issuing new shares and secured further bank borrowing of £70m.

The group issued 19.9% more shares while the new 12-month banking facility is in addition to its existing £250m facility maturing in August 2022.

It says it has had successful discussions with landlords and suppliers to reduce monthly outgoings and now expects this to be less than £14m a month, down from its previous forecast of £15m. It has furloughed 5000 employees while the board has taken a 20% cut in salaries.

From 25 March to 20 April it sold £7m of sofas online.

DFS and Sofology are continuing to receive deliveries from Far East suppliers and Dwell has been sending accessories to customers.

It says it will ‘to restart sofa deliveries once it is clear there is a safe and workable approach for two-person installations into customer homes.

‘The mitigating actions we have taken, alongside the new financing arrangements and placing, significantly increases the financial resilience of DFS for the months ahead,’ says Tim Stacey, DFS chief executive.

‘Alongside these actions, we also greatly appreciate the support and efforts from our loyal employees, committed suppliers and understanding landlords.’