(Alliance News) - DFS Furniture PLC on Thursday said it will not pay a dividend for financial 2020 as it posted a swing to loss but said financial 2021 has started strongly, forecasting a significant addition to annual revenue based on recent orders.
Shares in the furniture retailer were trading 2.9% higher at 172.80 pence each on Thursday morning in London.
For the 52 weeks ended June 28, DFS Furniture posted a pretax loss of GBP81.2 million, swinging from the profit of GBP22.4 million recorded for the 48 weeks to June 30, 2019. This was as revenue fell to GBP724.5 million from GBP901.0 million as a result of the pause in trading during the Covid-19 lockdown.
The group changed its accounting reference date from July 31 to June 30 last year and financial 2019 was therefore a short accounting period of 48 weeks.
Operating profit before depreciation and amortisation was GBP56.5 million, down from GBP60.7 million. Restructuring and impairment charges of GBP16.6 million were recognised in connection with strategic review of smaller brands.
No final dividend was declared to preserve cash amid Covid-19 related uncertainty, resulting in no dividends paid for the year, compared to 11.2p paid for financial 2019.
Looking ahead, Chief Executive Tim Stacey said: "The current year has started very strongly with all showrooms now open and our digital channels continuing to grow. Our year-on-year order intake growth over the last twelve weeks, combined with our previously announced higher opening order book, implies around GBP226 million of additional revenues will be realised in this financial year. We believe that this growth is due to a combination of pent-up demand from lockdown, consumers spending relatively more on their homes and the strength of the DFS and Sofology propositions in particular.
"In the absence of further lockdown impacts, we therefore look forward to reporting a strong first half sales and profit performance, although the full year outcome will be dependent on the effects of the pandemic and Brexit on consumer confidence, the housing market and levels of employment," he added.
As at year end, Doncaster-based DFS Furniture had cash of GBP62.3 million, up from GBP29.8 million the year before.
By Ife Taiwo; ifetaiwo@alliancenews.com
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