DFS expects to hit a profit, before tax, of £45 million, as the furniture retailer issued a trading update for the year ending 28 June.

As it ungraded its guidance, DFS reported its profit increased 15 per cent year-on-year, despite weaker market demand in H2.

Profit performance was underpinned by 2.7 per cent revenue growth, gross margin expansion and continued cost discipline.

“Continued investment in innovation across our platforms and people has achieved record customer Net Promoter Score (up 7 per cent) and sustained strong colleague engagement (up 19 per cent).”

It added that the business is well positioned to achieve its medium-term ambitions.

DFS benefitted from some market recovery in H1, however the retailer stressed there had been a “notable softening” in market demand in H2. “This was driven by a decline in consumer confidence and housing transactions, in part related to the Iran War,” the statement read.

While, group H1 order intake grew by 2.3 per cent YoY, it reduced to -4.4 per cent YoY in H2. Full year order intake also declined by 1.0 per cent. But it was broadly in line with the market.

Tim Stacey, DFS group chief executive, said: “I would like to express my gratitude to all our talented and dedicated colleagues, whose continued commitment strengthens the DFS Group and ensures outstanding products and services for our customers.

“Through the year we have made important strategic progress across the business while also delivering a strong financial performance. We have navigated the complex and changing market environment focusing on our customer propositions combined with disciplined cost management ensuring that we delivered our upgraded profit expectations despite the market softening in the second half.”

Full year results will be confirmed on 24 September.

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