Sofas specialist DFS has bucked the dismal furniture market trend to post a rise in EBITDA and flat sales in its most recent nine months’ trading.
DFS chief executive Ian Filby said that DFS, owned by private equity house Advent, had planned for bleak trading conditions and prioritised factors such as cost efficiency and cash generation.
The retailer generated a 3.1% rise in adjusted EBITDA to £56.2m in the nine months to April 30. Sales excluding VAT during the period edged down 0.7% to £486m. The profit rise primarily reflected reduced costs, mainly through more efficient marketing.
DFS chief executive Ian Filby said: “Although trading conditions remain exceptionally demanding for all UK retailers, we were fully prepared for that outcome in our plans for the year, and our good performance to date reflects our tight focus on the areas within management’s control.
“We have successfully managed our margin and costs, and maximised cash generation, while building a strong platform for our new store rollout programme.
“We have also continued to build on our well-established brand leadership and driven our market share by continuing to offer an outstanding proposition and excellent service to our customers, and by further developing our growing online proposition. These priorities will remain the focus in the final quarter of the year.”
Filby said that DFS’s cash balances rose to £49.1m from £7m at the beginning of the financial year after a £5m bond buy-back. The retailer completed a £6.9m sale and leaseback in its store in Inverness.