ScS bounces back from poor 2003

ScS is back on track after the disastrous end to last year, when profits plunged below original expectations.

However, like-for-like order intake for the first half of this year, ended March 31, climbed 7 per cent against the same period last year.

Gross margins continue to improve and are rising more quickly than the retailer expected.

ScS chief executive David Knight said: 'The embarrassing blip of last year is behind us and these results show how solid the business is. We have more transparent reporting in place now. Margins are back to 48 per cent.'

Last year's problems stemmed from the mispricing of some product, and the sofa retailer suffered depressed sales because of last summer's hot weather.

Looking forward, Knight said that the Easter and May bank holidays would be key times. He also hoped that this summer would be less hot than last.

ScS opened four stores in the first half and is on track to open four more in the second, bringing the total to 64.

Altium Securities analyst Geoff Lowery noted: 'This is a very creditable performance, given the difficult environment for big-ticket retailers, and represents an important step towards rebuilding confidence after last year.' Broker Seymour Pierce said: 'ScS looks well placed for the remainder of the year.'