Dunelm shares hit by Q3 sales slowdown

18th Apr 2024 07:56

(Sharecast News) - Dunelm shares dropped 5% on Thursday after the homewares retailer reported a slowdown in sales growth in its third quarter due to "volatile" trading conditions.

The company said total sales in the three months to 30 March were up 3% year-on-year at £435m, compared with 4.5% growth seen in the first half.

"As has been widely reported, trading conditions have continued to be volatile with March in particular seeing softer levels of demand," the company said.

Nevertheless, the retailer still lifted its forecast for full-year gross margins to be 110 basis points ahead of the previous year, compared with earlier guidance for a 100 basis-point improvement.

Dunelm said it continued to expected pre-tax profit or the financial year ending 1 July to be "broadly in line" with market expectations, which currently range from £200m to £205m, up rom £192.7m the year before.

"We have delivered a resilient performance in Q3, with continued volume-based sales growth through a period of more challenging and volatile market conditions," said chief executive Nick Wilkinson.

"Whilst discretionary spend remains under pressure, our relevant and attractive product offer continues to resonate with customers as they shop across our broad ranges to find quality and value for all areas of the home."

The stock was down 4.9% at 1,021.2p by 0850 BST.