Doncaster-based DFS Furniture plc cut its projected sales and profit for the current financial year, citing weak demand for upholstery and delays in deliveries caused by shipping issues in the Red Sea. 

The company said it now expects full-year revenue of £995 million to £1 billion, compared with its March estimate of £1 billion to £1.015 billion. It lowered its expected adjusted profit before tax to £10 million to £12 million, about half the previously expected £20 million to £25 million. 

DFS said the decline was due to a weak upholstery market, higher shipping costs and a lower level of delivered customer orders because of disruptions in the Red Sea, which will push some deliveries into the next financial year. 

Its shares fell 4% to 108p on the London Stock Exchange. 

Looking forward, the company said lower inflation and interest rates may help revive demand. 

“We expect the widely predicted lower inflation and interest rate environment to have a positive impact on upholstery market demand levels with the declines experienced across the last three years starting to reverse and the market slowly recovering in our FY25 period.”

“We have been encouraged by an improving trend in our Group order intake, which is up over +9% in our fourth quarter to date, in line with our expectations.”