Dunelm Group plc (LON:DNLM) said it is not recommending a final dividend but it expects to declare an interim distribution for the financial year ending in 2021.
The homeware retailer said it wants to save cash ahead of winter peak trading as the trading outlook remains uncertain and depends on potential further regional or national lockdowns.
READ: Dunelm posts higher August sales albeit well below July highs
The first two months of the current financial year saw strong trading, with sales up 59% in July and 24% in August, helped by pent-up demand following the lockdown store closures and by the timing of its summer sale.
Store footfall was “positive”, the company said, with digital making up 31% of total revenue, while home delivery sales rocketed 130% compared to 2019.
In the year to June 27, sales dipped 4% to £1bn, while profit before tax was down 13% at £109mln due to store closures and COVID-19 costs.
Year-end net cash was £45mln while Dunelm has access to £175mln of approved banking facilities and is eligible for the government’s Covid-19 Corporate Financing Facility.
"The short-term strength in online sales (up 130% in current trade) and stores (up double-digit LFL) is unlikely to end in three weeks as our forecasts might suggest," analysts at house broker Peel Hunt noted.
"However, we are more interested in how Dunelm’s customer base is broadening, driven by rising brand awareness and increased digital interactions. Store only customers are also shifting online, which should lead to a rising base of active customers shopping more categories, more frequently."
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