Dunelm’s value proposition resonates with consumers in H1

In a trading update for the 26-week period (H1) ended 30th December 2023, Dunelm Group reports strong sales growth, with total sales increasing by +4.5% to £872m, driven by volume.

Q2 saw continued sales growth in “a challenging market”, with total sales increasing by +1.0% against very strong comparatives (underlying Q2 growth was +14% last year), and the proportion of digital sales up to 37% (from 35% in Q1). 

PBT expectations for the full year remain in line with market expectations (£202m).

During the quarter, the group made further strategic progress, opening three new stores in Q2, extending the total portfolio to 183 stores. The retailer has opened a total of four stores so far this financial year, in a variety of formats and sizes, and is on track with its store-opening plans for the full year.

Dunelm pressed on with plans to improve the customer proposition across the business, increasing choice through expanding ranges across its categories, and continuing to optimise its website, which performed well during its busiest trading weeks, with improvements to both site speed and customer experience

It also launched the Home of Homes brand platform, with a marketing campaign which ran until November.

Dunelm is confident that it continues to gain share in a market which has been characterised by volatile week-to-week trading patterns, particularly through Q2, reflecting the ongoing pressures on consumers’ discretionary spend. 

CEO Nick Wilkinson comments: “The breadth of our range and outstanding value of our proposition continues to be well received by customers, resulting in a strong sales performance for the first half despite a tough market backdrop.

“Consumers remain under pressure and are actively seeking true value at all price points. Our customer offer and positioning as the ‘Home of Homes’ resonates particularly well in this environment, and we are confident we have continued to gain market share. At the same time, our strong operational grip continues to help us navigate the difficult environment and manage our margins.

“Supporting our communities remains at the heart of Dunelm, and I would like to thank all our colleagues and customers for making our recent Delivering Joy campaign our biggest ever, donating an incredible 125,000 gifts to local good causes during the Christmas period.

“Looking ahead, we remain excited about the compelling opportunity for growth for our business. We have continued to execute at pace on our strategic plans, opening four new stores over the first half of the year, whilst continuing to expand our ranges and improve our digital offer. Our new spring collections look fantastic in store and are being really well received by customers as we reach the end of our winter sale, leaving us well placed to make further progress in the months ahead.”

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