Newswatch - Trouble in store at MFI
Troubled retailer MFI Furniture Group is set to publish another set of dire results this week, with pre-tax profits estimated to be down to £10m, compared with £60.4m last year.
The group, which operates 184 stores in the UK and a further 88 in France, specialises in selling kitchens, bedrooms, bathrooms and other furniture.
Following sweeping management changes in March last year – which saw the arrival of chief executive John Hancock – MFI has returned to its roots in an attempt to revitalise the business. But, despite the management revamp, FD Susan Murphy has been a constant: she joined the company in 1984.
Shortly after Hancock’s arrival, MFI announced a restructuring plan which saw 1,500 job cuts and the number of products slashed by almost 60%, allowing the group to return to its core business of selling kitchens and bathrooms.
Hancock has found little room for manoeuvre, with investors looking for a quick turnaround in results.
But, with pressure mounting, MFI is facing aggressive expansionist overtures from US-based Wal-Mart. The retail giant has made no secret of its appetite for further acquisitions in Europe and, following its £6.7bn grab for Asda, it is thought to be targeting MFI.
As MFI posts pre-tax profits down by around £50m on last year, the same questions the City has been asking the group for the past five years will resurface.