Sofa group moves into the red as bank holiday sales disappoint

SOFA chain ScS Upholstery is set to slump to an annual loss after it revealed worse-than-expected trading over the crucial bank holiday weekend.

Yesterday it said its performance over the long weekend, a major trading period for furniture stores, had been "particularly disappointing" as like-for-like sales orders plunged by a fifth from a year ago.

ScS's warning is fresh evidence that the slowdown in the UK property market is hurting retailers of "big ticket" items, as a steep drop-off in home sales hits demand for goods such as sofas, washing machines and carpets.

ScS, which made pre-tax profits of almost £7.1 million in 2007, had been expected to break even this year, but analysts said the group was now likely to suffer a loss of £1.6m for the year to July.

The firm also raised concern in the City over its financial position as it said that, while it is paid up with all suppliers, its cash level as of 10 May was £4.8m.

The company said in a statement: "

Like-for-like sales order intake for the eight weeks up to and including 10 May 2008 is down by 14 per cent."