Highlights

• Nick Scali reported a 15% decline in Australia and New Zealand written sales orders during the September quarter.

• The company recorded 29% growth in UK written orders, including 14% growth on a like-for-like basis.

• Management guided to first-half FY27 underlying net profit after tax between AUD 28 million and AUD 32 million.

• Nick Scali disclosed an August cyber incident that disrupted enterprise systems for approximately three weeks.

Furniture Demand diverged sharply across Nick Scali Limited (ASX:NCK) in the opening quarter of FY27. Its Australia and New Zealand operations recorded a 15% drop in written sales orders, while UK orders increased 29%. The October 2026 trading update also outlined first-half profit expectations and further details of a cyber incident affecting internal systems.

ANZ Orders Show a Marked Slowdown

Written orders across Australia and New Zealand fell 15% in the September quarter, while store traffic declined approximately 10%. Management expects first-half ANZ Revenue to be 11% to 14% below the corresponding period. The update followed flat ANZ orders during the first five weeks of FY27, as previously reported in August.

Nick Scali sells furniture through its Nick Scali Furniture and Plush brands, mainly across showrooms. Written orders precede delivered sales, making the order book relevant to revenue in subsequent periods. The group is managing weaker demand while continuing its store development programme.

UK Orders Improve After Store Work

The company’s UK operation recorded a 29% increase in written orders, with like-for-like growth of 14%. The distinction reflects the effect of stores closed for refurbishment. UK revenue in FY26 was AUD 40.0 million, with the Business recording an AUD 4.8 million full-year net loss after tax.

That annual result comprised a AUD 5.6 million first-half loss and a AUD 0.8 million profit in the second half. UK gross Margin improved to 60.3%, compared with 47.1% previously. A further UK store opening is expected in late December, according to the October update.

FY26 Profit and First-Half Guidance

For FY26, group revenue rose 4% to AUD 516.7 million and reported net profit after tax was AUD 75.7 million, up 22% in the source material. ANZ generated revenue of AUD 476.7 million, representing 5.1% growth, and an ANZ gross margin of 66.0%.

The company guided to underlying net profit after tax of AUD 28 million to AUD 32 million for the first half of FY27. Its fully franked final FY26 Dividend of 39 cents per share was paid on 22 October 2026. The October update did not provide new distribution guidance.

Cyber Incident and Upcoming Openings

An August cyber security incident left enterprise resource planning systems unavailable for approximately three weeks. Stores continued trading through manual order processing. The company notified the Australian Cyber Security Centre and Australian Federal Police.

First-half Underlying Profit guidance excludes approximately AUD 980,000 of consultant and legal costs associated with the incident. Two ANZ stores opened in July, with another two expected in late December. The next financial disclosures will clarify the effect of orders, deliveries, costs and store openings on overall performance.