Dunelm offers more profit cheer as sales soar

Homewares retailer Dunelm has delivered yet another dose of profit cheer as it said sales surged in store and online.

The group saw like-for-like store sales jump 12.1% higher in its final quarter to June 29 thanks to “favourable weather”, while website sales soared 37%.

Total comparable sales rose 15.4% in the quarter.

It said full-year profits were now expected at the top end of City forecasts – having upped its earnings outlook for the second time in as many months in June.

The group said last month it was on course for pre-tax profits in the range of £124 million – £126 million, up from £102 million underlying profits the previous year.

Nick Wilkinson, Dunelm’s chief executive, hailed its “strong growth” in the final quarter.

But he sounded a note of caution over Brexit, with retailers recently warning the October 31 deadline is coming at an awful time for the sector.

He said: “We continue to invest in the business, particularly in strengthening our digital capabilities and reaching more customers through our brand marketing initiatives.”

“In the short-term, we remain cautious about the uncertain political climate and the impact it may have on consumer spending, but expect to make further progress in the year ahead and are confident about the group’s longer-term prospects,” he added.

The final quarter’s store sales growth marks a pick up from the 9.8% rise in the previous three months and has seen the group notch up a 7.7% like-for-like increase overall in the year.

Shares in the group have risen by nearly a third this year as Mr Wilkinson has led a push to boost results, close under-performing Worldstores and improve sourcing to increase profit margins.

Dunelm was founded in 1979 as a market stall business, selling ready-made curtains.

It opened its first shop in Leicester in 1984 and now has 171 stores nationwide and around 10,000 staff.