DFS revenue falls 27% to £725m, but orders soar

Doncaster-based DFS Furniture said on Tuesday its full-year revenue fell about 27% to £725 million “due to the pause in deliveries to comply with COVID-19 restrictions for the majority of the final quarter.”

In a trading update for the 52 week trading period ended June 28, 2020, DFS said it expects to make a loss of between £56 million and £58 million for the period.

DFS also owns Sofa Workshop, Dwell and Sofology. The group said it expects to cut an unspecified number of jobs at Sofa Workshop and Dwell.

However, DFS also reported “accelerated online trading throughout both the lockdown period and since showrooms reopened with online order intake up 77% year-on-year from 23 March to 12 July.”

It said order intake in showrooms following re-opening has been markedly above prior year comparatives, reflecting latent demand, with year-on-year growth of 69% between June 1 and July 12.

DFS said it has a solid financial position “with a particularly strong opening order book for the next financial year that will generate an incremental revenue benefit of c.£100m in FY21 and available cash resources at period end of just over £160m.”

On the job cuts, DFS said: “We have commenced an operational restructuring of Sofa Workshop and Dwell to improve the returns generated by those brands.

“Largely driven by this restructuring, we anticipate that we will recognise non-cash impairments of acquisition-related goodwill and some limited property right-of-use assets.

“We will also incur some limited cash restructuring costs of less than £2m associated with a targeted reduction in headcount.”

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