March 19 (Reuters) - British sofa retailer DFS Furniture reported a rise in half-year adjusted pretax profit on Thursday, as cost-saving measures and operational efficiencies outweighed challenging
DFS Furniture shares drop as retailer flags weaker customer footfall
By Simone Lobo
DFS Furniture Faces Challenges Amid Weaker Footfall and Economic Uncertainty
March 19 (Reuters) - British sofa retailer DFS Furniture on Thursday flagged weaker customer footfall since the start of this year as bad weather kept shoppers away, sending its shares 12% lower.
Company Overview and Profit Outlook
The company, which operates 115 stores across the UK and Ireland, kept its profit outlook for the year ending June 29 2026 unchanged, assuming no supply chain disruptions as a result of the Middle East conflict.
Consumer Confidence and Market Conditions
DFS Furniture said consumer confidence remained "delicately balanced" amid a slowdown in the British economy and persistent inflation and softer footfall from the adverse weather conditions since the first half.
CEO Insights and Analyst Commentary
CEO Tim Stacey told analysts that weather-related footfall declines typically reverse once conditions improve. He also said that the company faces headwinds from weakened consumer spending, which he said was likely to have been influenced by the Middle East conflict.
A survey published earlier this week showed that a British consumer sentiment index fell to its lowest since early 2025 in March.
"If the knock-on effects of the conflict start to impact day-to-day life (we assume mostly through inflation) then attitudes towards buying a big-ticket item may change," Peel Hunt analyst Jonathan Pritchard said.
Operational Updates and Financial Performance
Fuel Surcharges and Supply Chain Impact
FUEL SURCHARGES COMING
Stacey told analysts the potential impact from the conflict was hard to determine.
"We haven't seen any disruption and we haven't seen any surcharges coming through just yet, but there could be and we do anticipate at some point fuel surcharges coming."
"That'll be a potential for next year, FY2027, very immaterial for this year."
Cost Management and Profit Results
The company said it is hedged on electricity costs up to 2027 and expects exposure to higher levels of inflation to be limited in full year 2026 as a result.
DFS reported half-year adjusted pretax profit of 30.9 million pounds ($41.01 million), in line with a previous outlook of 30 million to 31 million pounds.
($1 = 0.7534 pounds)
(Reporting by Simone Lobo in Bengaluru; Editing by Janane Venkatraman, Sherry Jacob-Phillips and Jane Merriman)
