DFS Furniture (LSE:DFS) reported a 48.7% increase in underlying profit before tax to £44.9 million for the 2026 financial year, while revenue increased 2.6%.
The furniture retailer reported a gross margin of 58.1%, reaching a target set by the group as part of its strategy.
Free cash flow totalled £40.3 million, while net bank debt declined to £69 million from £107 million. Leverage was reduced to 0.9 times, and DFS restored dividend payments.
UK Upholstery Market Share Reaches 40%
DFS said its share of the UK upholstery market reached a record 40% during the year.
Within its multi-brand operations, the company reported that Sofology increased its market share.
DFS is also expanding its Home category, which includes products such as beds, mattresses, dining furniture and other living-room furniture. Order intake in the category increased 10.9%, with the company trialling mezzanine showroom space as part of the expansion.
Sofa Delivery Company Begins Serving Third-Party Retailers
DFS also began providing services through its Sofa Delivery Company logistics operation to third-party retailers.
The initiative extends the use of the group’s delivery infrastructure beyond its own retail brands and provides an additional source of revenue.
DFS also reported record levels of customer satisfaction and colleague engagement during FY26.
DFS Expects Moderate Profit Growth in FY27
The company described the near-term furniture market as subdued and reported softer order intake at the beginning of the 2027 financial year.
Despite these conditions, management expects moderate profit growth in FY27.
DFS also reiterated its medium-term targets of £1.4 billion in revenue and an 8% profit margin. These remain company targets rather than forecasts of achieved performance.
About DFS Furniture
DFS Furniture operates the DFS and Sofology furniture retail brands in the UK.
Alongside its core upholstered furniture business, the group is expanding into categories including beds, mattresses, dining and other living-room furniture. It also operates The Sofa Delivery Company, which provides logistics services for its retail operations and third-party customers.
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