UK retailer DFS Furniture has today reported a 13% fall in full-year core profits, blaming a "very challenging" market in its second half.
The firm had warned on profits in June, highlighting a dip in demand amidst the UK's uncertain economic and political outlook.
UK consumers' spending power has been dented by a rise in inflation, caused in large part by the fall in the value of the pound since last year's vote to leave the European Union, and by a slowdown in wages growth.
Sofas are seen as a discretionary "big ticket" purchase.
DFS's earnings before interest, tax, depreciation and amortisation fell to £82.4m in the year to July 29, down from £94.4m in the previous year and at the lower end of the company's forecast in June.
Gross sales rose 1.1% to £990.8m.
"Our financial performance reflects the current challenges of the UK furniture market," the company's chief executive Ian Filby said.
"Our recent strategic investments and operating efficiency programme support our confidence in our ability to deliver modest profit growth and cash returns in the current (2017-18)financial year," he added.
The firm is paying a total ordinary dividend of 11.2 pence for the year, up 1.8%. It has also paid a special dividend of 9.5 pence in the year.
