DFS has signalled its confidence in the Irish market despite some UK retailers putting their businesses through insolvency protection processes this year.
The big-ticket specialist’s chief executive, Ian Filby, told Retail Week that he was “absolutely delighted” with the performance of the sofa specialist’s two stores in the country, which opened last year.
B&Q and Monsoon have put their businesses through examinership this year amid tough trading conditions. Both expanded in Ireland while rents were at their peak and have found the high prices there unsustainable.
“I’d be disappointed if we couldn’t find further opportunities to expand in Ireland,” said Filby.
He added that DFS was expanding at the right time, with landlords more willing to negotiate lower rents in line with the tough market. “It’s fundamentally a good time to go in, we’ve seen [rental] prices have become more competitive and realistic,” he said.
He also added that with the austere conditions in the country, DFS’ value proposition is increasingly relevant.
DFS last week reported EBITDA growth of 9.9% to £31.1m, on sales up 7.6% to £319.4m in the 26 weeks to January 26. Since the period end, DFS refinanced through a £310m bond issue on March 8.
Filby said the refinancing was a “vote of confidence for us”.
Sales were driven by new store openings and an increase in online-led sales. “The more interesting your website is the more people will be encouraged to come into stores and sit [on sofas],” said Filby.
DFS is opening its latest store in Merry Hill on Friday and will feature the latest fit out including interactive customer displays allowing customers to access the DFS website and room planner app.
Filby added that the second half would be tougher because the retailer is up against strong comparables. He does not expect any change in consumer conditions this year. “2013 will be a re-run of 2012 and 2011,” he said.