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Dunelm posts positive Q3 results, but fears a tough final quarter

Published: 10 April 2013
Revenue for the 13 weeks to March 30, 2013, was up 15.4% at Dunelm Mill, bringing total sales value for the 39 weeks to March 30 up to £517.9m, an increase of 12.3% since last year.
Dunelm posts positive Q3 results, but fears a tough final quarter
Like for likes were up 5.2% for the quarter, benefitting from the later end to winter sales and an earlier Easter than in 2012. Sales were also boosted by the three store openings during the 13 weeks, including one re-location, taking the total store openings during the first three quarters of the financial year to date up to 13.

Despite the stunning result, the retailer is expecting sales growth to become "much harder to achieve" during the remainder of the year, according to chief executive Nick Wharton.

However, the company is expecting its year on year gross margin growth to strengthen further over the rest of the year. Gross margin for the third quarter is estimated to have continued its positive trend, with an improvement of approximately 20 bps compared with 2012.

Another store opening is planned before the end of the year, which will take the number of store openings for the full financial year up to 14 and superstore portfolio to 126. Dunelm's medium-term target is to operate from 200 UK superstores.

The store has seen continued progress in its multi-channel business, with revenue growth prompted, in part, by the impact from the spring/summer catalogue launched in early March. The retailer said it was still on track to create a "significantly larger, dedicated web fulfilment centre in the summer of 2013".

Mr Wharton said: "After a further period of solid trading and strategic progress, we now annualise our exceptionally strong comparative performance in the final quarter of last financial year. Accordingly, we anticipate that sales growth in like for like stores will become much harder to achieve in the remainder of the current financial year.

"With clear opportunities to strengthen further our customer offer in store, to roll out more new stores and to benefit from our exciting multi-channel agenda, the board remains confident in the longer term growth prospects for the business."


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