Hardwood furniture retailer Oak Furnitureland has reported a decline in sales due to a softer market and Red Sea disruption.
According to its latest accounts for the year ended 30 June 2024, total sales fell 17% to £236m. Oak Furnitureland said that the decline in sales was due to “reduced volumes caused by a soft market, the Red Sea disruption and the subsequent impact on freight and inflation costs”.
Despite this, Group operating loss improved by 19% to £12.4m vs £15.4m in 2024, driven by the diverse product pipeline and focus on enhancing the online and showroom estate. Improvements included a new incentive scheme, mystery shopping programme and ongoing digital transformation to optimise the customer experience from research to purchase.
Gross margin improved by 5.5%, but the Company continues to take a disciplined approach to cost management and operational efficiencies to improve overall profitability.
During the period, the retailer expanded its showroom portfolio, including a 10,000sqft store in Grimsby and a new showroom in North Shields. It has also undergone a product transformation with a focus on a broader home offering.
This includes new upholstery, beds and cabinetry, including the introduction of Newton and Henley collections, which “reflect current trends and offer a contemporary twist on classic designs”, the retailer said.
Oak Furnitureland has made a strong start to FY25 with bookings in the 16 weeks to Dec 22nd +9% LFL, underpinned by material market share gains.
Alex Fisher, CEO, commented: “Against a challenging market backdrop, with softer volumes and higher inflation, Oak Furnitureland delivered a resilient financial performance. Throughout the year, we have made significant headway in driving operational efficiencies alongside enhancing our product proposition to serve the whole home and make our brand more accessible to even more customers.
“I am proud of the strategic progress we delivered in the period, with the successful trial and adoption of our competitive interest-free credit offer, which resulted in the business securing additional funding and equitisation. This has strengthened our balance sheet and together with continued investment in our brand platform, has driven market share gains and positive LFL performance during the first half of FY25, putting us on a much firmer footing for the year ahead, with a clear plan to drive growth going forward.
“I’d like to take this opportunity to thank our teams for their hard work and continued dedication. None of this would be possible without their support and I am excited about what we can achieve together in the year ahead.”
