DFS Furniture slumped to a loss and did not propose a final dividend as the retailer suffered from an “extremely challenging” environment in the 2024 financial year.
The firm reported a loss before tax of £1.7m in the year to June, swung from a £29.7m profit last year. DFS said this was due to “record low market demand and Red Sea shipping disruption” which had deferred sales.
Revenue from continuing operations fell by 9.3 per cent to £987.1m in the year to June.
“Our revenue performance has been impacted by the significant fall in market volumes year on year and on pre-pandemic levels. In addition, the business has had to absorb significantly higher costs due to high levels of international freight rates and continued elevated interest rates,” Steve Johnson, chair of the firm said.
“Whilst overall our financial results are disappointing, we recognise they are an inevitable result of the market backdrop during the year being significantly more challenging than we expected before the year began,” he added.
The firm did not announce a final dividend due to the challenging market conditions, although an interim dividend of 1.1p was proposed earlier in the year.
Despite the difficult year, DFS said trading in the 2025 financial year so far has been in line with the board’s expectations.
It expects a “gradual market recovery” over the course of the year helping profits grow in line with market consensus. The firm remains confident in its ability to deliver £1.4bn in revenue, in line with its medium-term target.
“It is clear that the upholstery market has a long road to recovery given the 20 per cent decline on pre-pandemic levels that we have seen,” Tim Stacey, CEO of DFS said.
“Despite the challenges we have faced, we remain confident that the business is well positioned to capitalise on market recovery,” he added.
Shares in DFS soared during the pandemic but have struggled in the aftermath. Since mid-2021 its shares are down over 60 per cent.