The CEO of Oak Furnitureland says he is enthused by the progress the national chain is making after it narrowed losses last year and returned to growth in the period since September.

Alex Fisher said ahead of 2023/24 accounts becoming public that sales in the 16 weeks leading into Christmas have risen 9 percent despite there being "pretty much zero market growth" out there, adding that it had continued to make gains into 2025 too.

"We think the [wider] market has been somewhere between flat and slightly negative over that period," he added.

In an interview alongside CFO Patrick Lewis, Mr Fisher said the Swindon-headquartered retailer's trial and adoption of an interest-free-credit (IFC) offer at a lower £499 threshold "has unlocked the proposition, making it more accessible to even more homes and families."

That has also supported a push into a wider home offer beyond core cabinet for the retailer, which now trades from 67 stores following the addition of new units in Grimsby and, more recently, North Shields.

Mr Lewis, who joined Oak Furnitureland last year, said "We can see that the more expensive items we sell in terms of sofas and large dining tables have benefitted more than the average, and that is clearly because with the IFC offer we are helping customers make that purchase and the funding of a large asset for them."

Soon-to-be-public accounts for the year to June 30, 2024 will show operating losses reduced by £3 million to £12.4 million despite revenue falling 17 percent to £236.1 million.

That was largely the effect of a 550 basis point improvement in gross margin, to 57.5 percent, with Mr Fisher calling out two principal reasons — investment in supply chain partnerships including key relationships in ocean freight, and also the retailer being "obsessive about managing quality" though the supply chain.

"We have seen a material reduction in damage rates, with better handling throughout the business," he said.

The retailer, backed by global investment firm Davidson Kempner Capital Management since the summer of 2020, saw its consolidated net loss reduce to £17.1 million (2023: £28.5m), which also partly reflects it lapping elevated unrealised losses on forward contracts the previous year.

Last June, Oak Furnitureland signed an agreement providing access to additional funding of £10 million, completing what it called the equitisation of £47.8 million of outstanding debt in the process. The debt-for-equity swap more than halved its financial debt, and transformed the balance sheet, with net liabilities cut to £14.2m (2023: £44.9m).

Cash at June 30, 2024 totalled £2.5 million (2023: £1.8m) and net debt was cut to £21.2 million (2023: £40.7m), reflecting the equitisation of borrowings. It now has access to total funding of £29 million in all.

Lower debt will also mean lower interest obligations moving forward, but Mr Lewis told The Furnishing Report that "the most important impact was that it gave us the firepower to support the IFC offer.

"It was an investment in the balance sheet to support customers and enable them to buy without paying all the money upfront. That requires financial backing."

Mr Fisher said the retailer anticipates the furniture market returning to growth, citing recent interest rate cuts, improving consumer confidence and housing data, and cautious optimism surrounding ocean freight, despite Suez and the Red Sea being "effectively shut to shipping." But he added that whatever the wider market backdrop, the retailer's focus was on outperformance.