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Dunelm half-year results disappoint

Dunelm shutterstock_282750725 725 x 500

Dunelm has reported on half-year trading, covering the 26 weeks to 31 December 2016.

Highlights follow, but if you want to view the full publication, please visit our Industry Articles page, here.

Financial Highlights

 

FY17

FY17

FY16

+/-

+/-

 

H1

H1

H1

change

change

 

Total

excl. Worldstores2

Total 

Total 

excl. Worldstores

 

 

 

 

 

 

Sales

£460.5m

£452.4m

£448.1m

2.8%

+ 1.0%

 

 

 

 

 

 

Total LFL 1

 

£423.1m

£430.0m

 

-1.6%

LFL stores

 

£389.4m

£401.9m

 

-3.1%

Home delivery

 

£33.7m

£28.1m

 

+ 20.1%

 

 

 

 

 

 

Gross margin

50.40%

50.80%

50.70%

- 30 bps

+ 10 bps

EBITDA before exceptionals

£80.7m

£82.3m

£88.7m

-9.0%

-7.2%

EBITDA

£71.4m

£82.3m

£88.7m

-19.5%

-7.2%

Profit before tax and exceptionals

£65.2m

£67.0m

£75.5m

-13.6%

-11.3%

Profit before tax

£55.9m

£67.0m

£75.5m

-26.0%

-11.3%

EPS (fully diluted) before exceptionals

25.6p

26.2p

29.3p

-12.6%

-10.6%

EPS (fully diluted)

21.8p

26.2p

29.3p

-25.6%

-10.6%

Free cash flow

£19.0m

£26.5m

£76.8m

-75.3%

-65.5%

Dividend

6.5p

 

6.0p

8.3%

n/a

Business Highlights 
·    Increased market share although trading was slightly softer than expected due to a weaker market and some short term supply chain disruption
·    Acquisition of Worldstores enhances our leading position in homewares and enables acceleration of online and furniture growth
·    Ongoing store portfolio expansion, with five new stores opening in the half and a further five forecast for the remainder of the year
·    Good progress with strategic priorities and investment programme continues to strengthen the business for the future
·  Strong balance sheet supports growth plans in tough markets, with continued cash generation providing ongoing returns for shareholders

John Browett, Chief Executive Officer, said:
"We are in a transitional year for Dunelm and it has been a particularly busy first half - whilst we are operating in a challenging retail environment, especially in homewares, we remain focused on investing in and developing our business for the future. We are still in the midst of this exciting journey, and whilst trading was slightly softer than we would have liked due to a weaker market, we continue to increase our share and are confident that we will emerge as an even stronger market leader.

Martin Lane, Managing Editor of money.co.uk, comments:
“The waters are looking exceptionally choppy for Dunelm. They are failing to impress the city and they’ve openly admitted they’re going to be forced to put their prices up this year.  

“The brand could be another victim of our love of all things online. I suspect they may struggle to claw back this loss in profit over the next year especially with the economy entering such uncertain times.”  

Image : Imran's Photography / Shutterstock, Inc. 

Source : Dunelm PLC and Insight DIY
www.dunelm.com 

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08 February 2017

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