Sales setback takes shine off MFI

SALES have gone into reverse at furniture group MFI since the start of the year, falling by 3% like-for-like since Boxing Day.

Chief executive John Hancock described the UK retail performance of the past two months as 'a little disappointing' but said it was measured against a strong showing the previous year.

But he has every confidence that the business remains capable of further strong growth and says he will issue a further trading update in a month's time.

The sales decline took the shine off a strong set of results. Profits for the 12 months to 27 December topped £100m for the first time, jumping by 28.6% to £103.8m. Including property profits, the pre-tax figure was £117.9m and the dividend total is raised by 22.6% to 3.8p.

Much of the group's growth has come on the back of store refurbishment, which cost £19m last year. A further 46 stores were given the new look, taking the total to 122, two-thirds of the chain.

The first-year increase in orders at the refitted stores was 23% but there was a 10% decline in year two, which Hancock says he hopes to improve. UK like-for-like sales were up by 1.8% on total sales ahead by 5.7% at £911m. Hancock said Howden Joinery turned in outstanding results, operating profits surging by 62% to £72m.