Furniture-to-flooring retailer ScS (SCS) rallied 9% to 174.25p after reporting a massive rebound in customer orders after reopening stores on 23 May.

News of a strong balance sheet and liquidity position provided investors with additional comfort on Thursday.


In a trading update for the year ended 25 July, Sunderland-headquartered ScS flagged an exceptionally strong recovery in the order book since the lockdown was lifted.

Order intake was down 5.9% for the year as a whole, including a 92.5% slump during the actual lockdown period; ScS was forced to shutter its stores on 23 March.

However, the forward-looking stock market focused on the 92.2% year-on-year order intake increase through the final 9 weeks of the financial year, with ScS highlighting brisk business both in-store and online.


‘This reflects pent up demand, which has been supported by our well executed re-opening plans, our continued focus on value and customer service, and our increased investment in targeted marketing over the last two months,’ enthused ScS, as it joined arch-rival DFS Furniture (DFS) in reporting strong growth since reopening.

Recent strong momentum means ScS’ opening order book for the new financial year is significantly higher than last year’s level.

Although ScS said it is ‘too early to provide clarity on the outlook for the weeks and months ahead’, management stressed ScS is ‘a resilient business, with a strong balance sheet, coupled with a flexible cost base, and is well positioned to navigate these difficult circumstances and maximise opportunities as and when they arise.’


Shore Capital said Scs has emerged from the lockdown period ‘fully intact as a trading entity’ and poised to profit from the troubles of distressed competitors as a result.

‘The wider industry is going through considerable change with a number of business failures and ongoing rescue programmes underway; we note the recent announcements from Oak Furniture Land and Harveys, whilst we await to see how businesses like Carpetright and Tapi shape up in due course.’

Notwithstanding the ongoing uncertainty, the broker sees today’s update as ‘highly encouraging.’

Shore Capital highlighted a ‘very experienced and high quality management team,’ an order book circa £45 million higher than this time last year and the strong balance sheet, which it believes provides significant strength in the event of further disruption to business.


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Issue Date: 30 Jul 2020