DFS continues strong trading as consumers’ increase spending on homes

DFS has reported strong trading both online and its showrooms over the last six weeks, which it largely attributes to a rise in home spending during the ongoing Covid-19 pandemic.

The furniture retailer revealed that in the six weeks since its last trading update on 14 June, it has achieved a year-on-year order intake growth that is equivalent to around £70 million in revenues. It added that this is “significantly ahead of our initial expectations”. This is in addition to £100 million it will receive in revenue from its opening order book for FY21 outlined last month.

In July, DFS reported a 77% increase in online orders since the Covid-19 pandemic struck, from 23 March to 12 July, and outlined its intention to develop its eCommerce channel in light of this. It also recorded a 69% growth in order in-take at its showrooms from 1 June to 12 July, suggesting customers are becoming more comfortable with physical shopping.

DFS commented: “We believe that this trading performance reflects a combination of consumers currently spending more on their homes relative to other sectors, latent demand caused by the nationwide lockdown and also a strengthening advantage from our hybrid digital and physical retail offering, which is particularly relevant in this consumer environment.”

The retailer said its recent performance has put it in a strong financial position and is well placed “to capitalise on opportunities as its markets recover”.

However, DFS remains cautious regarding its outlook for the rest of the financial year, citing the economic uncertainties of Covid-19 and Brexit. It also noted that some consumers may be bringing forward spending decisions.

DFS added it will report its full year results on 24 September.