Britons splashing out on homes help ScS recover after annual losses
29 September 2020, 09:14
The group posted statutory losses of £3.1 million for the year to July 25 against profits of £14.3 million the previous year.
Sofa chain ScS has revealed it swung to an annual loss due to the coronavirus lockdown, but cheered a surge in sales as Britons splash out on their homes amid the pandemic.
The group posted statutory losses of £3.1 million for the year to July 25 against profits of £14.3 million the previous year as revenues tumbled by a fifth after lockdown forced the temporary closure of all 100 stores.
It said full-year losses totalled £1.4 million on an underlying comparable basis.
Pent-up demand saw sales almost double – up 92.2% – in the last nine weeks of the year after stores reopened at the end of May, which limited the decline in overall annual orders to 5.9%.
ScS said it was also “encouraged” by recent trading, with orders jumping by a better-than-expected 45.8% on a like-for-like basis over the first nine weeks of the new financial year.
It joined rival DFS in linking recent trading to a trend for Britons to prioritise spending on their homes during the crisis.
But shares fell 5% after the results, with ScS adding a note of caution ahead of its peak autumn trading season.
David Knight, chief executive of ScS, said: “We are delighted with the strong trading since the start of the new financial year.
“However, we are now entering our key autumn trading period and it remains difficult to predict the potential impact of the increased economic uncertainty, including the cessation of the Government’s Coronavirus Job Retention Scheme at the end of October.”
ScS said it had invested heavily in its online service, with internet sales rising 13.6% to £19.1 million in the year.
Over April and May, online orders were up 78% as locked-down shoppers switched to the internet, it added.
