Recent trading is ‘in line with expectations’ at DFS Group.
‘Market demand drivers for the upholstery sector remain delicately balanced. Consumer confidence remains below the long-term average and inflation remains elevated but housing transactions have been recovering, consumer savings levels are relatively high and interest rates look set to fall,’ says Tim Stacey, DGS Group ceo.
‘We are comfortable with consensus [profit before tax and brand amortisation of £39.4m] and are planning for profit growth in FY26, despite our expectation for a subdued market in the near term,’ says the DFS and Sofology owner.
‘I believe that our customer proposition has never been in better shape and that all elements of our vertically integrated business model are working efficiently and effectively, leading to record net promoter scores. Through focusing on what we can control and executing our strategy we have grown profits and cash flows in a weak market environment. This would not have been possible without the passion and dedication of our colleagues and I would like to sincerely thank them all for their hard work and support for our business,’ says Stacey.
‘Given the market share gains that we have made in the last few years, the recovery in our gross margins and the significant reduction in our cost base, despite inflation, I am optimistic about the future. We will continue to focus on what we can control and, even in a subdued market, we expect to grow our profit before tax in FY26 and further strengthen our balance sheet. When the market recovers we are well positioned to achieve strong growth and importantly profit and cash conversion and remain committed to achieving our medium-term targets of £1.4bn revenue and 8% PBT margins.’
Reported order intake rose 8.7%, while gross sales climbed to £1.39bn (£1.31bn) and revenue reached £1.03bn (£987.1m).
Underlying profit before tax rose from £10.5m to £30.2m as a pre-tax loss of £1.7m became a profit of £32.9m.
It added that exclusive brand partnerships now representing more than 40% of DFS sales.
