8th Sep 2021 08:30
(Alliance News) - Dunelm Group PLC on Wednesday reported swelling earnings as rapid growth in online sales and rising demand from customers turning to home improvement during lockdowns led to buoyant annual results.
The home furnishings firm posted a pretax profit of GBP157.8 million for the year ended June 26, jumping from GBP109.1 million the previous year.
Dunelm declared a special payout of 65.0 pence to cap off a bumper year for the FTSE 250 firm, which benefitted from increased demand as a result of the Covid-19 pandemic. A full-year ordinary dividend of 35.0p per share was also declared, having not paid one a year earlier.
Shares were 7.1% higher at 1,377.00p each in London on Wednesday morning, making the stock the best performer in the FTSE 250.
With more working and playing indoors due to lockdown measures, Dunelm saw sales jump, despite its store estate being hit by restrictions. Revenue rose 26% to GBP1.34 billion from GBP1.06 billion.
Digital sales more than doubled and accounted for 46% of all sales, compared to 27% a year earlier, signalling just how large the shift to online has been.
Promisingly, the firm also reported a return to positive like-for-like sales in the fourth quarter, doubling in the three months, albeit lapping easier comparatives. Like-for-like sales had tumbled 29% a year earlier.
In the third quarter, like-for-likes fell 16%.
"Sales growth in the first ten weeks of the new financial year has been encouraging, including a positive response from customers to our summer sale in July and continued outperformance versus the homewares market," Dunelm said.
The company expects pretax profit to be "modestly ahead" of current analyst expectations, despite continuing uncertainty over the impact of Covid-19.
"Whilst the macro-outlook remains uncertain and fast changing, with ongoing risks relating to Covid-19, supply chain disruption and inflationary pressures from raw materials, freight costs and driver shortages, we feel we are well-placed relatively to manage these challenges," the company stated.
By Will Paige; [email protected]
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