Homeware retailer Dunelm reports solid trading results for golden quarter

Dunelm, the homewares retailer, has reported robust trading results that outperformed the broader retail market for the golden quarter.

Despite this, investors remained sceptical, leading to a nearly four per cent drop in its share price in early trades, as reported by City AM.

The Leicester-based business saw a 1.6 per cent growth in sales to £490m in the 13 weeks leading up to December 28, amidst what Dunelm described as a "challenging market". Sales in the first half of the year were at 2.4 per cent.

While Dunelm expressed caution regarding the Autumn Budget's impact on the wage costs of its 11,500 employees, it also stated that productivity-boosting initiatives were in progress and it anticipated mitigating the upward pressure on costs in the medium term. "We’re pleased with our performance in the first half; we are growing sales and volume, with customers again responding well to the value and choice we offer across our ranges," said Chief Executive Nick Wilkinson.

He added: "At the same time, we’ve made significant strategic progress across multiple initiatives which are helping us to improve our attractive, specialist offer and continue to gain market share."

During the first half of the year, Dunelm acquired 13 stores in Ireland and opened its first inner London store in Westfield.

"As we move into the second half of [the year], we have successfully launched our Winter Sale which is being well received by customers seeking amazing value across a wide choice of relevant products for the colder months."

Despite facing a challenging environment, Dunelm chief Wilkinson, remains optimistic: "As we navigate this challenging environment, we see even more opportunities to harness our unique business model, raise the bar on our proposition and fulfil our ambitions as The Home of Homes."

In the last year, Dunelm achieved a record revenue of £1.7bn, up 4.1 per cent from £1.64bn the previous year.