Last checked at 10 Jan 2012 07:00
10th January 2012
TRADING UPDATE
26 weeks to 31st December 2011
Dunelm Group plc ("Dunelm" or "the Group"), the UK's leading specialist homewares retailer, issues the following trading update in respect of the 26 week period to 31st December 2011.
Revenue
Group revenue for the period was:
FY12 (H1) | FY11 (H1) | |
Total sales | £299.9m | £275.7m |
Total sales growth | 8.8% | 8.5% |
Contribution from new space | 7.7% | 9.7% |
LFL sales growth/(decline)1 | 1.1% | (1.2%) |
Total revenue for the half year grew by 8.8%, benefitting from the Group's continued development programme. This programme included 11 new superstore openings, one of which was a relocation from an existing superstore unit.
Like for like sales for the half year grew by 1.1%. Within this, LFL sales growth in the second quarter was 3.8%, in part reflecting the more difficult trading environment in the weeks immediately preceding Christmas 2010, when snow was estimated to have dampened sales over the quarter by 200-300bps. The revenue performance for the half year was stronger than for the homewares market, as measured by the BRC home textiles index.
Gross Margin Percentage
Gross margin for the period is estimated to have improved by 10 basis points compared with the same period in the prior year, reflecting a small year on year decline in the second quarter as expected. We continue to anticipate that gross margin over the full year will be broadly in line with the prior year.
Strategy Progress
After the high level of new store openings during the first half, the total number of superstores trading at the period end was 113. A further eight new store opportunities were committed as at the period end, of which four are anticipated to open in the second half2. Our medium term target remains 150 - 200 superstores across the UK.
We have also significantly enhanced our multi-channel proposition through the successful launch of Reserve & Collect.
Financial Position
As at 31st December 2011 net cleared funds at bank amounted to £40.4m. The average daily net cash position over the half year was £47.6m.
Commenting on Dunelm's performance, Nick Wharton, Chief Executive, said:
"Dunelm has achieved robust trading results in a very demanding retail environment, and has continued to gain market share on a like for like basis. We have also made significant progress on our longer term development plan, not only delivering a very ambitious store opening programme over the last quarter, but also making fundamental improvements to our on-line offer that have been well received by customers. The combination of satisfactory trading and a disciplined approach to operating costs means that the Board anticipates that profit before tax for the half year will be approximately £52m.
"We remain cautious about the impact of the UK consumer environment on our trading in the near term. Nevertheless, with eight further store openings already committed, and with our "Simply Value for Money" proposition resonating with a wide range of customers, we remain confident in the future growth prospects for the business."
Notes
1. Like-for-like sales represent revenues from stores trading for at least one full financial year prior to 3rd July 2011 and exclude stores with significant change of space in the current or previous financial year.
2. The committed pipeline of eight stores includes one freehold acquisition and one existing under-sized store to be relocated to a previously acquired freehold site.
3. Quarterly sales analysis:
Year to 30th June 2012 | Year to 2nd July 2011 | ||||||
Q1 | Q2 | H1 | Q1 | Q2 | H1 | ||
Total sales | £133.4m | £166.5m | £299.9m | £126.7m | £149.0m | £275.7m | |
Total sales growth | +5.3% | +11.7% | +8.8% | +11.6% | +5.9% | +8.5% | |
Contribution from new space | +7.3% | +7.9% | +7.7% | +9.5% | +10.1% | +9.7% | |
LFL sales growth/(decline) | -2.0% | +3.8% | +1.1% | +2.1% | -4.2% | -1.2% | |
For further information please contact:
Dunelm Group plc | 0116 2644 356 |
Nick Wharton, Chief Executive | |
David Stead, Finance Director | |
MHP | 020 3128 8100 |
John Olsen / Simon Hockridge |
Forthcoming Newsflow.
Dunelm will release its interim results on 8th February 2012. There will be a presentation for analysts at 9.30am at the offices of UBS, 1 Finsbury Avenue, London EC2M 2PP. Those analysts who wish to attend are requested to contact Naomi Lane of MHP on the above number or at naomi.lane@mhpc.com . A copy of the presentation will be made available on the Dunelm website.
Notes to Editors
Dunelm is the UK's leading specialist out of town homewares retailer, operating in the £12bn homewares market. The Group currently operates 122 stores, branded Dunelm Mill, of which 113 are out-of-town superstores and 9 are located on high streets, and an on-line store, to be found at www.dunelm-mill.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 c.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 employs c.6,500 full and part time staff, the vast majority of whom work in the stores and was listed on the London Stock Exchange in October 2006 (DNLM.L). The Group has a current market capitalisation of approximately £900m.