Homewares retailer trading as Dunlem Mill sees stores generate 24% increase to £27.2 million.
Family-owned homewares and furnishings retailer Dunelm Mill has seen first half profits rise 24%.
Interim results for the 26 weeks to December 29, 2007 showed sales grew by 10.6% to £197.4m (2006: £178.4m), with a like-for-like increase of 4.9%.
Product gross margin increased by 80 basis points.
Dunlem added in its statement that selling prices remained stable after many years of price deflation, and improvements have been witnessed in costs due to its increasing volumes.
Operating profits were 40% higher than last year at £27.6m.
Profit before tax was £27.2m, an increase of 24.4% over the £21.9m recorded in
the equivalent period last year.
However, Dunelm said it has seen underlying sales growth has slowed in the first two months of its second half, and is anticipating tougher trading in its second half
The business also confirmed that co-founder Bill Adderley, who started up the company from a Leicester market stall and who is now 60, will step down from the board after 29 years.
He will continue to be associated with the business as Founder and Life President.
Dunelm is bullish on its outlook in the second half citing a core strength - its low cost operating model - as one reason why it can weather any consumer downturn.
Chief executive, and son of Bill Adderley, Will Adderley said: "we believe that our business model will stand us in good stead during periods of market
weakness, as it has done in the past.
"Customers can easily trade up or down in our stores and the average spend per transaction (under £30) is relatively low, so for most people, a trip to Dunelm does not represent a major outlay."