DFS has provided an update on trading for its financial year ending 1st August 2015.
DFS reports that its gross sales are up 7% year-on-year, in a trading update for the period ending 1st August 2015. After a strong first half, the upholstery giant's trading momentum continued through the second half, gross sales for the period to date up 4% compared to the comparator period. This slight reduction in growth rate in the second half reflects the more demanding comparatives and the extra trading week last year, states DFS.
Sofa Workshop and Dwell have both continued their recovery in performance since the group acquired the brands, and have made a positive contribution of around around 1% to the group's growth, both in the second half and full year to date. However, due to their scale and stage of turnaround, their profit contribution to the group has been limited.
Given the strength of second-half trading to date, the DFS' board expects the group to deliver a record performance for the full year, with underlying results within the current range of market expectations.
Free cashflow remains robust, with net debt expected to be less than twice the underlying EBITDA at the financial year end. The board will announce DFS’ first dividend as a public company in October.
The Group's growth initiatives this year include a measured programme of store expansion and retail space release in the UK and overseas, continued development of its omnichannel proposition, and constant enhancement of the product range. As part of this strategy, DFS opened its first store outside of the UK and Ireland at Cruquius in The Netherlands in November 2014. The group is aiming to open two further stores in the coming year.
Jon Massey will retire from full-time executive employment in his current position as COO this autumn, but will remain in an advisory capacity.
DFS is confident that the business is in a strong position to sustain its track record of gross sales growth and market share capture in 2015/16.
