DFS has cautioned that full-year profitability will fall below last year’s total after hot weather and “disruption” to deliveries from the Far East dented fourth-quarter performance.
The sofa specialist said the heatwave sparked “sigificantly lower than expected order intake” over key trading weekends and added that “disruption outside of our control” to ships bringing made-to-order products from the Far East created further trading headwinds.
DFS said that, as a result, like-for-like revenues were around 3% down in the 23 weeks to July 7 and circa 4% lower across the wider 49-week period.
The retailer cautioned that, despite “variable cost flexibility” and cost cuts providing “some mitigation”, full-year EBITDA would come in below the £82.4m recorded last year.
DFS added that it expects the furniture market to “remain challenging” over the coming year.
It cited reduced consumer confidence as the main reason for the tough trading conditions, but said it expected “some alleviation of current short-term demand effects”.
DFS also insisted that its acquisition of Sofology and anticipated progress at its Dwell and Sofa Workshop businesses would “help mitigate the challenging sales environment”.
The business will file its full-year results on October 4.
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