9th Jan 2020 08:15
(Alliance News) - Dunelm Group PLC on Thursday reported sales and margin growth in the second half of its financial year, building on the strong growth and profitability delivered last year.
The FTSE 250-listed homeware retailer said like-for-like sales for the 13 weeks to December 28 increased by 5.0%, thanks to "strong" growth across the total retail system. Total sales growth, including new stores, was 6.2% in the second quarter.
For the first half, Leicestershire-based Dunelm said like-for-like sales increased by 5.6%, with total growth climbing by 6.0%.
The company also noted its gross margin improved by 110 basis points in the second quarter, mainly due to sourcing gains and lower product markdowns. Margin improvements were made across all product categories, Dunelm noted.
In the year-to-date, the margin has improved by 120 basis points.
Looking ahead, Dunelm said it is on track to add over 6,000 new online-only products in its current financial year following the "successful" transition to its new digital platform during the second quarter.
In terms of earnings, the company expects pretax profit for the first half to be GBP83 million, after adjusting for the impact of the new accounting standard IFRS 16. In the first half of financial 2019, Dunelm's pretax profit totalled GBP70 million.
The company said the impact of IFRS 16 reduced pretax profit by GBP1.3 million in the first half of financial 2020.
"We are really pleased with our performance in the first half, building on the strong growth and profitability delivered last year. The second quarter was particularly strong in terms of sales and margin growth, on both one-year and two-year bases," said Chief Executive Nick Wilkinson.
"We are excited by the significant opportunities ahead of us," added Wilkinson.
Dunelm shares were 0.4% on Thursday morning in London at 1,148.00 pence each.
By Evelina Grecenko; [email protected]
Copyright 2020 Alliance News Limited. All Rights Reserved.
Related Shares:
Dunelm