Dunelm hikes profit outlook again amid home renovations boom

Homewares retailer Dunelm has said full-year profits will smash expectations after seeing sales soar as Britons do up their homes.

Shares in the group raced more than 7% higher after its second profit upgrade in just over a month.

It comes after Dunelm saw total sales jump 59% in the seven weeks since March 28, against pre-pandemic levels two years ago.

It added that sales have “performed significantly” ahead of the wider market since stores reopened on April 12, with growth online remaining solid.

The impressive performance in its fourth quarter so far means Dunelm now expects pre-tax profits to be more than £148 million – far higher than the £128 million to £134 million expected in the City.

The group had already upped its annual profit outlook in early April, before shops reopened.

Dunelm said: “This high sales growth reflects the strength of our customer proposition and a variety of other factors, including pent-up demand following the extended store closure period, a buoyant homewares market and some benefit from the unseasonably cold spring weather.”

Demand for homewares and DIY products has rocketed since the start of the pandemic as Britons stuck at home with time on their hands have focused on housing and garden renovations.

Retail expert Clive Black said the homewares market should remain rosy for the rest of the year, even as restrictions lift.

He said: “With many folks unlikely to have the overwhelming urge to go on a foreign holiday in summer 2021, demand for home-related goods could yet be stronger and more sustained than we previously thought.”