Dunelm returns to sales growth

7th Jul 2011 07:31

Out-of-town home furnishings retailer Dunelm moved into like-for-like sales growth in the quarter year to 2 July, saying it is winning share in a struggling market.Total sales grew by 11% from the same period the previous year to £123.8m, or by 1.9% on a like-for-like basis, which only considers the shops that were operating during both periods. With like-for-like sales having fallen by 1.3% in the prior quarter, they were up by just 0.1% in the half year to 2 July."Despite the challenging consumer environment, the strength and breadth of Dunelm's customer offer, particularly in its range of price points, has seen the Group's LFL revenue move ahead of the BRC (British Retail Council) home textiles index over each of the last two quarters, implying a further gain in market share," Dunelm said.The company expects gross margins to have increased by 120 basis points over the full year."This improvement reflects full mitigation of the impact of cost pressures, including commodity inflation and indirect taxation, while maintaining our "simply value for money" price positioning," the firm said.Chief executive Nick Wharton said he was "encouraged" by the performance."Our focus on constantly improving our customer offer has allowed us to gain market share while expanding gross margins; at the same time our future growth prospects have been enhanced through strengthening the pipeline of new stores and the continuing development of our multi-channel footprint," he said. "The combination of satisfactory trading and a disciplined approach to operating costs means that the board anticipates that profit for the year will be in line with current market expectations."---RG