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UK retailer Dunelm's H1 sales 43% above pre-pandemic levels

Published 15/02/2023, 07:20
Updated 15/02/2023, 09:46
© Reuters. FILE PHOTO: A view shows a Dunelm store in St Albans, Britain October 15, 2020. REUTERS/Peter Cziborra

© Reuters. FILE PHOTO: A view shows a Dunelm store in St Albans, Britain October 15, 2020. REUTERS/Peter Cziborra

(Reuters) -British retailer Dunelm Group Plc (LON:DNLM) declared a special dividend on Wednesday after its first-half sales soared 43% above pre-pandemic levels benefitting from a gain in market share in homewares and furniture.

As households were faced with soaring energy bills during the winters, Dunelm's customers splurged on items such as thermal curtains, lifting its mid-year sales by 5% to 835 million pounds ($1.01 billion).

The company, which sells furnishings ranging from cushions and bedding to kitchen equipment, said it continues to invest in improving its product design to find cheaper alternatives for their customers, while also working towards digitalising its whole business.

Dunelm reported a pretax profit of 117.4 million pounds for the half year to Dec 31, which was down about 17% but in line with its expectations. Analysts at Peel Hunt and RBC said that beat their forecasts.

Its shares were up 0.9% to 1,180 pence at 0941 GMT.

Sweden's IKEA said on Tuesday that price cuts as well as promotional campaigns had boosted its footfall and sales volumes in its current fiscal year.

Yet households in Britain are expected to tighten their belts this year as prices of everything continue to rise.

Dunelm said it still expects its annual profit to beat a market forecast of 176 million pounds but warned that the consumer outlook remains unpredictable.

"While forecasts remain unchanged, given consumer uncertainty, we see more upside than downside risk," analysts at Peel Hunt said. 

Dunelm declared a special dividend of 40 pence per share and said it had gained 160 basis points in market share in the UK homeware sector to top 10% and sees continued gains in the furniture business.

© Reuters. FILE PHOTO: A view shows a Dunelm store in St Albans, Britain October 15, 2020. REUTERS/Peter Cziborra

($1 = 0.8268 pounds)

($1 = 0.8267 pounds)

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