10th Apr 2019 08:48
LONDON (Alliance News) - Homewares retailer Dunelm Group PLC could beat the market's profit expectations for its current financial year, it said on Wednesday.
After strong first quarter revenue growth, and despite political and economic troubles in the UK, Dunelm expects to beat consensus for pretax profit for its year ending June of between GBP115.6 million and GBP118.5 million.
In its previous financial year, Dunelm reported pretax profit of GBP93.1 million, up 0.8% year-on-year, meaning it and the market both expect a strong acceleration in growth.
Chief Executive Nick Wilkinson said: "We are delighted that customers continue to respond well to our improving homewares offer as we help them create a home they love."
"The strong growth in the third quarter reflects our ongoing focus on attracting more customers to the brand and giving them more reasons to shop with us through great product and service. Our performance was also buoyed by a positive homewares market."
"Our multichannel proposition is improving all the time and we are excited about the opportunities ahead of us as we continue to invest in and develop our digital capabilities," he added.
For the third quarter, ended March, Dunelm's total revenue rose 6.1% to GBP284.5 million, with like-for-like sales rising 13%.
Online quarterly like-for-like sales increased 32%, while in store sales were up 9.8%.
In the first nine months of Dunelm's year, revenue is 2.8% higher year-on-year at GBP836.3 million, with like-for-like sales 9.3% higher.
Dunelm's third quarter gross margin has increased 90 basis points year-on-year, helped by closing its dilutive Worldstores business, and Dunelm expects further margin improvement.
There will be some slightly higher costs in its current financial year as improved financial performance will mean increased staff incentive payments.
Shares were 2.9% higher early on Wednesday at a price of 890 pence each.
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