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ScS Group is “optimistic” on strong trading

ScS Group posted strong sales in the 26 weeks to 23 January.

The sofa retailer saw gross sales jump 13.9% to £182.3m over the past six months – this is up from £160m a year earlier.

ScS Group benefitted from a surge in sales over the lockdown period and the pent-up demand whilst stores were closed. In the first quarter, online sales jumped by 98%.

New lockdown restrictions means that stores are closed again, which led to a slump in sales.

The comapny’s order book is at £90m. This is £16m more than at the same period in 2019. Like-for-like order intake fell by 9% over the period but it increased by 12% in the 21 weeks to December 19, 2020.

ScS Group has said that it remains “cautiously optimistic” after posting recent results.

“Whilst it is too early to provide clarity on the outlook for the weeks and months ahead, we remain cautiously optimistic given the strong trading experienced by the Group following the first and second lockdowns,” said the group in a trading statement.

“Given the tactile nature of our products, the majority of customers chose to wait until stores re-opened to try our products in person before making their purchasing decision. This resulted in the business benefiting from pent-up demand, coupled with an increased level of investment by UK consumers in their homes. The Group has built a robust balance sheet and continues to focus on cost and cash management to ensure we maintain this resilience in these challenging times.”

ScS Group shares (LON: SCS) are trading +0.48% at 211,00 (0828GMT).

Shore Capital analysts, Darren Shirley and Clive Black, commented: “At the start of the important winter trading period on Boxing Day, ScS was trading from 57 out of its total 100 stores, with a further 37 forced to closed on the 30th December; with all closed on the 4th January. The stores are reported to have traded strongly whilst open.

“Online continues to partially compensate for store closures, increasing by 98% in the period, though most customers appear to want the tactile experience of a store visit ahead of purchasing furniture, and particularly floorings!

“Despite this end of period decline, the news on the ScS’ order book is broadly encouraging, sitting at £90.5m on the 26th January (inc. VAT), which is £16.8m higher year-on-year.”

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