Dunelm reports 10.3% rise in revenue

‘John Lewis refugees’ hunting for cheaper bedding and curtains are giving a boost to Dunelm, according to its boss John Browett.

The John Lewis competitor reported a 10.3 per cent leap in total revenues to £448million and same-store sales up 4.6 per cent to £405million from £387million a year earlier.

Fewer promotions meant it sold more products at full price and margins improved to 50.7 per cent helping pre-tax profit up 10.7 per cent to £75.5million in the 26 weeks to January 2.

See the full half year report here and the investor presentation here. 

Browett dismissed recent claims by Ikea that Europe had hit ‘peak stuff’. He said: ‘People want quality. They want good value, and quality. We see John Lewis refugees come here because we are seen as value for money.’

The chain, which started as a market stall in 1979, now has 151 shops and Browett plans to open another 50. He is focused on new outlets in London and the South-East.

 Source : Laura Chesters – Daily Mail
www.thisismoney.co.uk/money/markets/article-3441387/John-Lewis-customers-hunting-cheaper-products-boost-Dunelm.html.

Analyst Views: 

Martin Lane, spokesperson at www.money.co.uk gave us his views:

 "This morning’s results from Dunelm shows they’ve nailed some key ingredients for success in the last six months. With over 140 stores already in place, the retailer is placing a strong focus on snapping up new locations including the big smoke of London. This will offer customers across the country the opportunity to enjoy an ‘in store experience’ which there is clearly still an appetite for. Dunelm has certainly come a long way since they launched on a Leicester market stall in 1979 and are now heading towards becoming a truly national brand. The group has also placed a heavy focus on its home delivery channel ticking many boxes for convenience hungry consumers.”

Connor Campbell, a senior market analyst at www.spreadex.com advised:

"A record first half, with an 11% surge in pre-tax profit to £75.5 million, saw homeware retailer Dunelm jump over 5% this Wednesday, bouncing away from its recent lows with an investor-pleasing set of figures. It’s a fairly anomalous set of results, Dunelm bucking a trend that saw most of the retail sector suffering a setback over Christmas."