Amid a swathe of store and factory closures due to the Government's coronavirus lockdown, leading national retailers have outlined their response to the crisis.
DFS has suspended all customer-facing and manufacturing operations, temporarily closing its showrooms, manufacturing and distribution operations, yet its websites will continue to take orders.
The group says it has access to a total of £250m of committed bank facilities, with unutilised, immediately available cash resources of approximately £70m, and a customer order book of some £185m. Given its inability to deliver its order bank, DFS intends to seek additional financing facilities, in case the lockdown is prolonged.
Group CEO Tim Stacey says: "DFS has traded for over 50 years, during which time we have faced many difficult periods including the 2008 financial crisis. On every occasion, thanks to our customers and colleagues, and the longstanding relationships with our suppliers and other stakeholders, we have emerged stronger."
Dunelm, which had already taken action to support its most vulnerable and lowest-paid workers, had intended its stores to continue offering contactless collection points and help support their local communities, but has also been forced to temporarily close down its customer-facing operations.
Like DFS, Dunelm has taken actions to protect its cash resources. It has access to £175m of financing facilities, which it will draw down in full.
For the first 10 weeks of Q3 (ended 7th March 2020), Dunelm saw LFL sales up +6.5%, against strong comparatives. Total growth, including that from new store openings, was +7.9%. However, over the two weeks ended 21st March, Dunelm saw a progressively negative impact on trading as a result of Covid-19, with total LFL sales down -8.8%, driven by reduced footfall. Yet Dunelm's online business continues to grow, and as store footfall has fallen further, the retailer reports a material increase in online demand.
ScS' stores will be closed for a time, but the retailer has pledged to continue to provide support to customers and employees through dedicated remote-working teams.
ScS reports that it has been building a strong balance sheet, and has £74.8m in cash. Like DFS and Dunelm, ScS is reducing cash expenditure to protect its short-term liquidity, and has already moved to paying rent in advance monthly, rather than quarterly.
