DFS pushes ahead with expansion
DFS has created 200 new jobs and will add a further 300 staff as it presses ahead with plans to open new stores.
The company revealed this morning that its cash balances at the end of the first quarter were £47.2m compared to £22.3m in the same period last year.
Its ability to generate cash has allowed it to fund its expansion programme from its own resources and is set to return £17m to shareholders.
However, the furniture firm showed it is not immune to the pressure on consumer spending with sales in the 13 weeks to the end of October cut from £149.6m to £128.2m.
DFS chief executive Ian Filby said: “This has been a period of heavy investment in the future of DFS, with the successful opening of seven new stores and a significant expansion of our UK manufacturing capability, together creating 200 new jobs with a further 300 planned.
“This investment has been undertaken against a UK retail trading environment that has remained challenging. As we anticipated, we have seen a continuation of the weak demand that began in the second half of our last financial year and was particularly evident during August.
“Although we expect no early improvement in the trading environment, we are confident that DFS has the right strategy, proposition and team to manage the business through these tough conditions.
“The current investment in new stores and manufacturing will continue to drive our market share and we will also focus on margin, costs and cash generation to deliver a good financial performance over the year as a whole.”
Ebitda in the first quarter fell from £15.2m to £8.7m including £2m spent on the company’s expansion plans.
In the first quarter DFS opened stores in Huddersfield, High Wycombe, Hereford, Colne and Old Kent Road and since the start of the second quarter has opened further outlets in Brentford and Lincoln.
