Last checked at 2 Apr 2015 07:00
2nd April 2015
Dunelm Group plc
Third Quarter Trading Update
Dunelm Group plc ("Dunelm" or "the Group"), the UK's leading homewares retailer, provides the following update on trading for the third quarter of its current financial year, comprising the 13 week period ended 28th March 2015.
Revenue
Total revenue for the third quarter grew by 10.7% to £216.2m. Total like-for-like (LFL) growth (combining LFL stores and Home Delivery) moderated from the first half of the financial year (+6.2%) to +4.9%, reflecting the stronger comparative performance in the third quarter of last financial year.
13 weeks to 28th March 2015 | 39 weeks to 28th March 2015 | |||||
Sales (£m) | YoY Growth (£m) | YoY Growth (%) | Sales (£m) | YoY Growth (£m) | YoY Growth (%) | |
LFL stores | 176.2 | +4.9 | +2.9% | 517.2 | +16.6 | +3.3% |
Home Delivery | 14.1 | +4.0 | +40.0% | 36.6 | +13.7 | +59.9% |
Total LFL | 190.3 | +8.9 | +4.9% | 553.8 | +30.3 | +5.8% |
Non-LFL stores | 26.0 | +12.0 | - | 68.8 | +40.6 | - |
Total | 216.2 | +20.9 | +10.7% | 622.6 | +70.9 | +12.9% |
In-store LFL sales grew by +2.9% benefiting from a particularly strong Winter Sale performance as well as continuing success in developing our Made to Measure service and Furniture proposition.
Home Delivery sales grew by +40% during the quarter. The launch of our new web platform is expected to take place before the end of the financial year.
Non-LFL store performance includes sales from two new stores opened in the period, taking the total superstore openings in the financial year to date to eight, including one relocation.
Gross Margin Percentage
We estimate that gross margin for the quarter was consistent with the prior year. Our guidance remains that gross margin for the full financial year will be broadly level year on year, subject to satisfactory clearance of excess furniture inventory during the fourth quarter.
Strategy Progress
Our pipeline of legally committed new store opportunities stands at eleven, of which four are anticipated to open prior to the financial year-end. This will take the number of store openings for the full financial year to twelve and our superstore portfolio to 148 stores at the year-end, compared with our medium term target to operate from 200 UK superstores.
We continue to invest in our infrastructure to enable future growth. We have recently committed to a second leasehold Distribution Centre close to our existing facility in Stoke which will provide additional capacity to our network from Spring 2016 onwards.
Financial Position
On 24 March 2015, the Group paid a special distribution of 70p per share, amounting to £141.6m. Following this special distribution, net debt as at 28th March 2015 was £66.6m. One-off costs associated with the distribution amounted to £0.8m.
Commenting on Dunelm's performance, Will Adderley, Chief Executive, said:
"We have recorded solid sales growth over the last quarter, and we believe that we have continued to take market share on a like-for-like basis.
"We have a strong Easter Event now in progress, a powerful Summer Sale to follow, and the launch of our new web platform before the end of the financial year, all of which leave us well placed to drive further sales growth through our final quarter. However, the full year outcome against our ambitious internal targets will ultimately depend on the traditionally volatile summer months' trading.
"Looking into the next financial year and beyond, we remain very excited about the prospects for the business and about the clear growth ambitions that we set out in February."
For further information please contact:
Dunelm Group plc
| 0116 2644 356 |
Will Adderley, Chief Executive | |
David Stead, Finance Director | |
MHP Communications | 020 3128 8100 |
John Olsen / Simon Hockridge |
Forthcoming News flow
Dunelm's next scheduled trading update will be on 9th July 2015 followed by the full year preliminary results announcement on 10th September 2015.
Notes
1. Like for like sales represent revenues from stores trading for at least one full financial year prior to 28th June 2014 and exclude stores with significant change of space in the current or previous financial year.
2. The Year to 27th June 2015 represents a 52 week period. Financial Accounts for 2014/15 will be presented on a 53 week basis, with 52 week comparatives provided for ease of interpretation.
3. Quarterly sales and margin analysis:
Year to 27th June 2015 | ||||
Q1 | Q2 | H1 | Q3 | |
Total sales | £180.6m | £225.8m | £406.4m | £216.2m |
Total sales growth | +17.0% | +11.8% | +14.0% | +10.7% |
LFL sales growth | +8.9% | +4.2% | +6.2% | +4.9% |
Gross margin growth | +40bps | -30bps | Level | Level* |
*estimated
Year to 28th June 2014 | |||||||
Q1 | Q2 | H1 | Q3 | Q4 | H2 | FY | |
Total sales | £154.3m | £202.1m | £356.4m | £195.4m | £178.4m | £373.8m | £730.2m |
Total sales growth | +1.7% | +7.3% | +4.8% | +9.9% | +12.0% | +10.9% | +7.8% |
LFL sales growth | -5.3% | +2.9% | -0.9% | +5.0% | +5.5% | +5.3% | +2.1% |
Gross margin growth | +70bps | +120bps | +90bps | +90bps | +50bps | +70bps | +80bps |
Notes to Editors
Dunelm is market leader in the £11bn UK Homewares market. The Group currently operates 150 stores, of which 144 are out-of-town superstores and 6 are located on high streets, and an on-line store, to be found at www.dunelm.com.
Dunelm's "Simply Value for Money" customer proposition offers industry-leading choice of quality products at keen prices, with high levels of availability and supported by friendly service. Core ranges include many exclusive designs and premium brands such as Dorma, and are supported by a frequently changing series of special buys. The superstore format provides an average of 30,000 sq. ft. of selling space with over 20,000 products across a broad spectrum of categories, extending from the Group's home textiles heritage (bedding, curtains, cushions, quilts and pillows) to a complete Homewares offer including kitchenware and dining, lighting, wall art, furniture and rugs. Dunelm is one of the few national retailers to offer an authoritative selection of curtain fabrics on the roll, and owns a specialist UK facility dedicated to producing made-to-measure curtains.
Dunelm was founded in 1979 as a market stall business, selling ready-made curtains. The first shop was opened in Leicester in 1984 and over the following years the business developed into a successful chain of high street shops before expanding into broader homewares categories following the opening of the first Dunelm superstore in 1991.
Dunelm has been listed on the London Stock Exchange since October 2006 (DNLM.L) and has a current market capitalisation of approximately £1.7bn.