MFI is taking action to revive sales

Pre-tax profit for the half-year to 12 June fell to �32.1m ($59m), down from �59.3m in the same period last year.

Sales at its MFI retail stores dropped 11.4% to �416m partly due to a poor Easter period when it lost out to rivals who spent more on advertising.

But the firm said it had seen "signs of improvement" in recent trading.

Facing up to the challenge

MFI's Howden Joinery business continued to enjoy strong growth, with sales up by 25.6% to �227m, while sales at the firm's French retail business grew 3.2%.

Overall MFI's sales were down by 0.7% to �703m for the six months.

The fall in profits had been expected after the firm warned in May that it had experienced "challenging conditions" in its core UK stores.

The firm blamed insufficient spending on advertising ahead of the key Easter trading period and tough price competition from rival retailers.

MFI said it had now stepped up its promotional activities and had reshuffled its management to improve the stores' performance.

In recent months speculation has grown that the firm could be a bid target, with reports that a management buyout is being considered.