Adairs Limited (ASX: ADH) posted a 1.7% increase in underlying net profit after tax (NPAT) to $34.6 million for the year ended June 30, 2026, as growth at its Adairs and Mocka brands offset challenges at Focus on Furniture.
Group revenue rose 3.8% year-over-year to $641.7 million, driven by a 12.6% increase in online sales to $209.2 million, which now account for 32.6% of total revenue. Store sales were flat at $432.5 million, while gross profit climbed 4.4% to $302.2 million, lifting gross margin by 10 basis points to 59.0%. Underlying earnings before interest, tax, depreciation and amortization (EBITDA) increased 1.0% to $68.7 million, though underlying EBIT dipped 0.4% to $55.0 million.
The company reported a statutory net loss of $39.4 million, reflecting a $73.9 million post-tax charge for significant items, including a $56.7 million non-cash impairment of Focus on Furniture’s goodwill and brand intangibles. Net debt fell 29% to $47.6 million, the lowest level in four years, at 0.7 times underlying EBITDA.
Adairs’ eponymous brand delivered a 3.9% rise in sales to $459.2 million, with online revenue up 9.4% and like-for-like store sales increasing 1.4%. Underlying EBIT for the brand grew 14.9% to $41.1 million, supported by a 90-basis-point improvement in EBIT margin to 9.0%. Mocka achieved record sales of $71.2 million, up 22.9%, with underlying EBIT rising 32.1% to $10.1 million.
Focus on Furniture reported a 5.6% decline in sales to $111.3 million, with a 67.6% drop in underlying EBIT to $3.8 million. The brand’s gross margin contracted by 40 basis points to 50.4%, and the company recorded a $56.7 million impairment charge. Management outlined a multi-year turnaround plan, including product renewal starting October 2027 and a national store rollout over five years, with no new openings planned for FY27.
Adairs declared a final dividend of 6.0 cents per share, fully franked, bringing the full-year payout to 11.5 cents, a 9.5% increase. The company also flagged $25 million in capital expenditure for FY27, excluding $5 million for technology upgrades, and noted a 60–80 basis-point gross margin tailwind from foreign exchange hedging at 67.4 cents per USD.
Shares in Adairs rose 2.1% to $1.445 following the results, though the stock remains 50% below its 52-week high of $2.87.
