23rd Sep 2021 09:17
(Alliance News) - DFS Furniture PLC on Thursday reinstated its dividend after a surge in sales in the 2021 financial year, and said orders continue to run well ahead of expectations.
Revenue in the year that ended June 27 rose 47%, to GBP1.07 billion from GBP724.5 million the previous year. The retailer, which owns the DFS and Sofology brands, swung to a pretax profit of GBP99.2 million from a loss of GBP81.2 million.
Compared to the 2019 financial year, revenue was up 7.2% from GBP996.2 million, while pretax profit more than doubled from GBP43.6 million.
Shares were up 1.5% to 271.46 pence in London on Thursday morning.
DFS declared a final dividend of 7.5p per share, and added that it intends to steadily grow its dividend over time in line with cash generation and company prospects. It is the first payout since financial 2019, when DFS paid a 3.7p-per-share interim and 7.5p-per-share final dividend.
The record sales and profit in financial 2021 reflects earlier investments in showrooms and online capability, increased consumer spending on homewares, and pent-up demand at the start of the period, the Doncaster-based company said.
In an update on current trading, DFS said order intake is well ahead of its target for 7% growth versus the same time in financial 2019. But conversion of orders into sales will be constrained by the capacity of its suppliers' factories and DFS's logistics.
"The short-term operational environment continues to be exceptionally uncertain and difficult, given well-reported logistics disruption, cost inflation pressures and unplanned Covid absences," the company said.
Looking ahead, DFS said it is "well placed" to achieve its medium profit scenario in financial 2022. In June, the company set out a range of forecasts, with a medium scenario for pretax profit of GBP85 million - a 14% decline from financial 2021.
"The group is very well positioned to build on its market leadership position in sofa retailing and to target further growth as we invest to strengthen our business platforms and extend our retail proposition into adjacent product categories," Chief Executive Tim Stacey said.
By Ivan Edwards; [email protected]
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