Furniture giant DFS has issued a profit warning following the General Election result as the hammered value of the pound jeopardises margins.
Full-year operating profits are now expected to be between £82 million and £87 million, below the market expectations.
“We believe these demand effects are market-wide, in line with industry indicators, and are linked to customer uncertainty regarding the General Election and the uncertain macroeconomic environment,” DFS said.
“As stated previously, the upholstery market does see short-term demand fluctuations from time to time, within an overall historical trend of long-term growth.”
A decline in footfall and consumer confidence has already put a strain on its trading since the Brexit vote and the increased uncertainty following the hung parliament is likely to exacerbate the issue.
Despite the looming economic headwinds, DFS remains optimistic about its long-term prospects.
“We have maintained our investment in the business and we are confident that we will outperform the market over the longer term, driven by our scale, business model and proven growth levers,” the retailer said.
“We believe our expectations for the next financial year are realistic based on consumer confidence remaining broadly in line with current levels, given its consequent impact on upholstery demand.”