It looks as if the upholstered furniture market, in contrast with some retail sectors, has plenty of spring left in it.

Market leader DFS was able to report sales growth of 7% in its latest half year and made optimistic noises about the prospects ahead.

The retailer referred to a “healthy furniture market environment” in which it is able to push forward with its key strategic projects.

Shares in DFS, which floated last year, have been trading at about 309p. That’s quite some way below the 52-week high of 354p but well ahead of the low point of 252p.

The stock was actually down last week, when it updated.

That may be because, despite the reassuring news and confidence in the outlook there was no increase in profit guidance.

Sales are on the up at DFS

DFS

Sales are on the up at DFS

And that was in contrast to competitor ScS. In January, ScS reported that profits would come in “significantly ahead” of market expectations at the time on the back of a total like-for-like order intake ahead 8.8%

However DFS has a variety of initiatives under way to drive growth, notably building up its stable of own-brands such as the fairly recently acquired Dwell and Sofa Workshop businesses.

They are key to extending DFS’s appeal to more aspirational shoppers, a group with which it had not pulled its weight in the past, despite controlling about a quarter of the market by value.

Market upswing

Alongside that, DFS looks as if it may also sit comfortably in overseas markets after a small number of store openings over the last few years in the Republic of Ireland and the Netherlands.

“Big-ticket retailers seem to be winning spend again as consumers, while still value-conscious, prove willing to splash out on their homes”

George MacDonald

DFS said last week that Sofa workshop, Dwell and DFS Netherlands “all contributed encouragingly to overall group sales growth”, so it looks as if the retailer is on the right track.

In general, big-ticket retailers seem to be winning spend again as consumers, while still value-conscious, prove willing to splash out on their homes.

The BRC sales data for January, for instance, revealed that furniture was the strongest performing category – a result that will please furniture retail chiefs in what is the most important month of the year in their category.

DFS Share price graph

DFS Share price graph

DFS share price graph

The showing was likely also helped by the property market following an increase in mortgage approvals – they reached a four-month high in December.

The sofas market, like furniture more widely, looks pretty well upholstered assuming the trading climate doesn’t deteriorate.

But investors will try to work out which out of DFS and ScS is most likely to knock the stuffing out of the other in the longer term.

Morrisons takes the fight to Aldi and Lidl

After an unexpectedly good Christmas, Morrisons has moved rapidly to make the most of the launchpad the festive season provided

Morrisons jpg

Morrisons jpg

It has made more price cuts and this week unveiled the 25p oyster – available in a store near you for Valentine’s Day.

The combination of lower prices and low-priced luxury should play well to the retailer’s traditional customers.

And it’s an approach that’s worked brilliantly for Aldi and Lidl, who Morrisons boss David Potts will have in his sights.