Dunelm Reports Record Preliminary Results

Dunelm Group plc ("Dunelm" or "the Group"), the UK's leading homewares retailer, today announces its preliminary results for the 53 weeks to 2 July 2022. 

Highlights                                     

• Strong sales growth of 16.2%⁶ with total sales 41% higher than FY19

• Homewares market share gain of +140bps and continued share gains in furniture⁷

• Active customers grew by 8.5%⁸ over the year, with increases across all demographics
  
  
• New ecommerce and furniture fulfilment operations opened in the year, giving capacity for growth and improved delivery options for customers
  
  
• Scope 1 carbon and plastic packaging reduction targets met and textiles take-back service introduced in stores nationwide

• Healthy gross margin of 51.2%⁶ including impact of the extra Summer Sale in the year

• PBT growth of 32.4%⁶, with a strong profit margin reflecting cost leverage and operational grip

• Free cash flow of £153.0m, representing 70% conversion of operating profit

• Final dividend of 26p (FY21: 23p) taking the full year ordinary dividend to 40p, an increase of 14.3% 

Outlook and current trading 

• Sales have remained robust in the first ten weeks of the financial year

• Proven strength of the Dunelm business model gives us confidence, despite an extremely challenging environment

• Our primary focus is to continue offering outstanding value to all our customers

• Expect to deliver c.50% gross margin for the full year and manage costs through efficiency improvements and operational grip

• On track to deliver FY23 results in line with analysts' expectations⁹

Nick Wilkinson, Chief Executive Officer, commented:

"Our colleagues and our committed supplier partners are at the heart of our success. In another year of excellent performance, I am extremely grateful for their skill, commitment and adaptability in the face of new external challenges and during another busy period of progress across the business. 

"We feel confident and well prepared to weather the current economic pressures - we emerged from an unprecedented global pandemic as a bigger, better business and we believe we have the tools in place to do that again. That said, the operating and economic environment is extremely challenging.

"In this environment, we have to make every pound count, both for ourselves through our tight operational grip and cost discipline, and for our customers, through our offer of outstanding value at all price points. 

"Dunelm, at its heart, offers customers great choice and value. Now is not the time for us to shy away from that, but for us to fully embrace it; whether it's our Winter Warm collection or our Student Essentials range, we think Dunelm's unique and market-leading offer is more relevant than ever before." 

1 Digital includes home delivery, Click & Collect and tablet-based sales in store

2 Free cash flow is defined as net cash generated from operating activities less capex (net of disposals) and business combinations, net interest paid (including leases) and loan transaction costs, and repayment of lease liabilities. A reconciliation of operating profit to free cash flow is included in the CFO review

3 Excluding lease liabilities. Full definition provided in the table of alternative performance measures in the CFO review

⁴ Ordinary dividends declared relating to the financial year

⁵ FY21 special dividend of 65p declared with the FY21 financial results and paid in FY22. FY22 special dividend of 37p declared with the FY22 interim results and paid in FY22

⁶ 52-week basis. On a 53-week basis, total sales were £1,581.4m (+18.4%), gross margin was 51.2% (-40bps) and PBT was £212.8m (+34.9%). 52-week results are unaudited

⁷ GlobalData UK homewares market

8 Unique active customers who have transacted at least once in the 12 months to June 2022. Source: Barclays. The basis of calculation for this metric has been updated in FY22 and the prior years restated on a consistent basis, as we believe that this is a more accurate estimate

⁹ Company compiled consensus average of analysts' expectations for FY23 PBT of £178m, with a range £130m to £193m

Source : Dunelm

Image : shutterstock.com / 282750725 

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