DFS Furniture shares fall 9% amid revenue, virus woes

Shares of Doncaster-based DFS Furniture fell 9% on Tuesday after it said first-half revenue for the 26 weeks ended December 29, 2019, fell 5.7% to £488 million and it warned the COVID-19 situation made it impossible “to give guidance with any certainty for the full-year out-turn.”

DFS Furniture CEO Tim Stacey said: “Despite the challenging retail environment, and excluding some isolated systems disruption in Sofa Workshop, our performance over the first half has been as expected, given the exceptional prior year comparative driven by latent demand. 

“In particular we have seen a good performance by the DFS brand in driving conversion and margins and continued online sales growth.  

“Trading in the second half for the group has also started satisfactorily with performance in the DFS brand particularly encouraging, with order intake growth year-on-year and good gross margins. 

“However, given the uncertainty as to how the current COVID-19 situation will develop it is not possible 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.  

“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.

“Notwithstanding the uncertain short-term outlook, we remain confident in the group’s financial strength and relative track record of performance in all environments.

“Furthermore, we believe our leading market position will allow us to drive long term attractive value creation for our shareholders.”

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