Adairs Limited reported higher sales and underlying profit for FY26. Growth from Adairs and Mocka offset a decline at Focus on Furniture.
The group reported revenue of $641.7 million, up 3.8 per cent, while underlying net profit after tax increased to $34.6 million. However, the group reported a statutory loss after tax of $39.4 million, mainly due to non-cash adjustments, including a Focus on Furniture impairment.
The Adairs brand drove the result, with sales up 3.9 per cent to $459.2 million and underlying EBIT up 14.9 per cent to $41.1 million. EBIT margin rose 90 basis points to 9 per cent, while gross margin was 60.9 per cent.
Mocka sales increased 22.9 per cent to $71.2 million and underlying EBIT rose 32.1 per cent to $10.1 million, supported by range expansion and pricing changes. The brand also began testing standalone stores in June.
Focus on Furniture partly offset the growth, with sales down 5.6 per cent to $111.3 million and underlying EBIT down 67.6 per cent, due to lower order volumes and product availability.
Management attributed the decline to a third-quarter leadership transition with limited handover, which disrupted inventory planning and ordering, reduced product availability and extended delivery times.
A new divisional CEO has since joined the business, and the company reinstated ordering in April and May. The company expects inbound stock to restore availability and improve lead times through Q2 FY27. New collections are due from October.
CEO Elle Roseby said the company was satisfied with the results from Adairs and Mocka. “Both businesses delivered strong sales and EBIT. This reflects a sharper and more relevant product range, improved margins, stronger customer engagement, operating discipline and a more measured approach to capital allocation.”
Adairs ended FY26 with net debt of $47.6 million, down $20 million, while full-year dividends increased 9.5 per cent to 11.5cps. For FY27, it plans to open seven to 10 stores, refurbish four to six and close two to five, while Mocka will continue its physical store trial and Focus on Furniture will undertake relocations and refurbishments without opening new stores.
Management expects Focus on Furniture to remain difficult in the first half of FY27 before improving later in FY27 and recovering further in FY28.
The group will continue its Vision 2030 strategy, focusing on product and brand development, store and customer experience, operating productivity and portfolio discipline.
