Dunelm Group PLC (LSE:DNLM), the homewares retailer, described third-quarter trading as “strong”, with sales rising 6% year-on-year to £423mln in the 13 weeks to 1 April 2023 after a “successful” winter sale and good demand for its new spring lines.
Adjusting for the fact that part of its winter sale fell in the second quarter of this year because the previous financial year consisted of 53 weeks, third-quarter sales increased by around 10%.
Noting the “unpredictable” consumer outlook, the company left its full-year expectations unchanged, with pre-tax profit estimated to meet analysts’ consensus forecasts of £185mln.
The gross margin was 30 basis points (bps) lower than last year in the third quarter, in line with expectations. The decline included a tailwind of around 50 bps from the timing of the winter sale.
Dunelm forecast a gross margin of 50% for the full year.
"We are seeing strong momentum in the business as customers continue to appreciate the quality and value across the Dunelm range, despite a challenging trading backdrop,” said Dunelm CEO Nick Wilkinson in a statement.
“This was apparent through our successful winter sale and the positive launch of our new ranges for spring and summer as customers look forward to longer days and outdoor living," he added.
Dunelm said digital sales accounted for 36% of the third-quarter total, up from 35% last year. In the year to date, sales grew by 5% to £1.25bn, of which digital sales represented 35%.