Soft: a positive adjective for sofas, a negative one for consumer sentiment. DFS (DFS) had been expecting the latter kind, but not to this degree. "The trading environment has however recently weakened beyond our expectation, with significant declines in store footfall leading to a material reduction in customer orders," said management on Thursday. Ouch. Its shares promptly fell a fifth.
Coupled with some very soft retail sales data, this sent most of the other clothing and general retail stocks south, with DFS followed by Next (NXT) and Dunelm (DNLM) as the worst performers, down 6 per cent on the day. Click here for our take on the drama. We discussed all this, and some brighter spots for retail, on this week's companies podcast, which you can find here or via your usual provider.
As we said on the pod, it was rather an unfortunate day for Quiz to announce its intention to float. The retailer is seeking admission to the alternative market in mid-July. Founded in 1993 in Glasgow, it focuses on 'occasion wear and dressy casual wear' for 16 to 35 year-old women. It's fast fashion, but with 73 stores and 167 concessions across the UK and the Republic of Ireland.
A couple of results announcements helped broaden the retail picture. Majestic Wine (WINE) also flagged difficulties in its core UK market: wine is more expensive for consumers, and weakening consumer confidence should drag. Management have correspondingly "chartered a slightly different course through the next couple of years", settling for a slower turnover growth rate and focusing on repeat business. In terms of the company-specific narrative, it seems to be putting last year's marketing mis-step behind it. Read our analysis here.
A company that has made its own mistakes in years past, but is thoroughly 'over' them, is Mulberry (MUL). In step with the domestic picture, same-store sales in the 10 weeks to June were modest, but this global luxury retailer, with successful product launches and an effective digital strategy, looks harder to bring back to earth. Click here for our analysis.
There are other sectors, of course. Scroll below the line for more companies analysis, and follow me on Twitter @iankmsmith and the team @IChronicle
