Citi flags challenges in UK market, optimistic on Aussie retailer Nick Scali

Nick Scali

19/01/2025 19:26

** Citi says London-listed DFS Furniture's  DFSD.L  trading
update suggests overall UK market may be incrementally more
challenging from demand and cost perspective
    ** DFS expects 2H25 profit to be lower than 1H25, reports
group order intake up 10.5% yoy for 26 weeks ending Dec. 22
    ** Nick Scali  NCK.AX  entered UK market in April 2024 after
acquiring local retailer Fabb Furniture
    ** Brokerage retains Aussie home furnishing retailer's "buy"
rating and target price A$15.31
    ** Citi expects Nick Scali's near-term UK performance to be
driven by self-help initiatives, including refurbishments
    ** (UK refurbishments)...are also benefiting from Nick
Scali's Australian scale which co can leverage for refurbishment
pricing - Citi
    ** Brokerage forecasts UK business EBITDA loss of A$5.1 mln
($3.16 mln) in 1H25 and A$6.8 mln in FY25
    ** Nick Scali up 0.8% so far this year as of last close,
lagging behind a 1.6% rise on the ASX All Ordinaries index
 .AORD 

($1 = 1.6150 Australian dollars)

 (Reporting by Nikita Maria Jino in Bengaluru)
 ((Nikita.Jino@thomsonreuters.com;))