7th Jan 2014 08:30
LONDON (Alliance News) - Dunelm Group PLC Tuesday said total sales grew in the first half of the year, but were down on a like-for-like basis.
However the homewares retailer said gross margin improved in the first half, and it expects a pretax profit of around GBP61.5 million for the six month period.
Dunelm, which operates its stores under the name Dunelm Mill, said that total sales rose 4.8% to GBP356.3 million in the 26 week period ended December 28, compared with GBP340.1 million a year earlier. It said that trading in the first half overall was boosted by a stronger second quarter, having blamed hot summer weather for slower store sales at the beginning of the financial year. It said it also benefited from the opening of six new stores in the period.
However, on a like-for-like basis, Dunelm said that sales declined by 0.9% during the first half, compared with sales growth of 2.2% a year earlier. It said that a steeper decline in like-for-like sales in the first quarter was partially offset by sales growth of 2.9% in the second quarter, supported by its new autumn catalogue and first-ever television advertising campaign.
Dunelm said that its was trading from a total of 131 superstores by the end of the period, and expects to open four new stores during the second half of ht year. It said its medium-term target remains to operate from around 200 superstores across the UK.
The group said that its multi-channel business is growing, representing around 6% of total revenues in the second quarter, buoyed by the transition to a new fulfilment centre in October, which increased capacity and further capability for home deliveries.
"These investments have been funded through continued gross margin expansion and with continuing profitable growth from new stores," Chief Executive Officer Nick Wharton said in a statement. "The board remains confident in the long-term growth prospects for the business."
In early trading Tuesday, Dunelm shares were off 6.4% at 916.60 pence.
By Rowena Harris-Doughty; [email protected]; @rharrisdoughty
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