TIDMDNLM
RNS Number : 6627D
Dunelm Group plc
11 October 2018
11 October 2018
Dunelm Group plc
First Quarter Trading Update
Dunelm Group plc ("Dunelm" or "the Group"), the UK's leading
homewares retailer, reports the following trading update for the
first quarter of its current financial year, comprising the 13-week
period ended 29 September 2018.
Revenue
For the first quarter of our financial year we report total LFL
revenue growth of +4.2%, a pleasing result in light of the strong
prior year comparative (+9.3%).
With our customers increasingly interacting and transacting with
us across multiple channels, we regard total like-for-like (LFL) as
a more meaningful performance measure than individual channel LFL.
However, in the interests of transparency we provide the following
channel analysis:
- LFL store revenues increased by +1.3% year on year. Excluding
a 1.7ppts year on year benefit of tablet-based selling in-store for
home delivery, underlying LFL performance would have been
-0.4%.
- LFL online revenues on Dunelm.com continued to grow strongly
in the quarter by +33.3% (including tablet-based selling in-store,
growth would have been +50.8%).
- Total multi-channel revenue for the quarter, defined as online
revenue plus Reserve & Collect and tablet-based selling
in-store, represented 14.8% of continuing Dunelm revenue, an
increase of 3.9ppts year on year.
Including the benefit of changes to the store portfolio, total
growth of continuing Dunelm business was +5.8%.
Total growth at group level was +0.1%, reflecting our withdrawal
from the Worldstores businesses as previously announced.
13 weeks to 29 September
2018
Revenue YoY Growth YoY Growth
(GBPm) (GBPm) (%)
-------- ----------- -----------
LFL Stores(1) 201.6 +2.5 +1.3%
-------- ----------- -----------
LFL Online - Dunelm.com(2) 26.5 +6.6 +33.3%
-------- ----------- -----------
Total LFL 228.1 +9.1 +4.2%
-------- ----------- -----------
Non-LFL Stores(3) 16.1 +4.2 +35.2%
-------- ----------- -----------
Total continuing Dunelm 244.2 +13.3 +5.8%
-------- ----------- -----------
Non-LFL Online - Worldstores(4) 4.0 -13.0 -76.7%
-------- ----------- -----------
Total Group 248.2 +0.3 +0.1%
-------- ----------- -----------
1. LFL Stores - stores trading for at least one full financial
year prior to 2 July 2018 without any significant change of space.
LFL stores revenues include Reserve & Collect sales, and home
delivery sales in respect of orders placed via in-store tablets
2. LFL Online - Dunelm.com (excludes Reserve & Collect
sales, and home delivery sales in respect of orders placed via
in-store tablets)
3. Non-LFL Stores - new stores (including relocations) opened in
the current or previous financial year, and existing stores with
significant change of space in the current or previous financial
year
4. Non-LFL Online - Worldstores.co.uk, Kiddicare.com and
Achica.com (these websites are now closed)
Gross Margin
As expected following the elimination of lower margin sales from
Worldstores businesses, gross margin was stronger with a +130bps
increase at Group level compared with the first quarter last year.
More importantly, we achieved growth in continuing Dunelm gross
margin of +50bps, as the dilutive effect of Worldstores' lines
transferred to Dunelm.com was more than offset by FX benefits and
improved sourcing.
Business Development
We have now closed the Worldstores and Kiddicare websites and
have completed the transfer of approximately 20,000 lines onto
Dunelm.com.
We remain on track to launch our new Dunelm.com web platform in
Q3 of this financial year which will allow us to launch Click &
Collect and subsequent developments (such as improved delivery
options) with much greater agility going forward.
There was one new superstore opening in the first quarter (a
relocation), leaving our superstore footprint at 169 stores. At
this point we are legally committed to one new store that is due to
open towards the end of the financial year (which is also a
relocation), and we remain in discussion on further new store
opportunities.
During the quarter we launched a new brand campaign as part of
our drive to reach new customers. This is an integrated marketing
campaign across TV, radio and social media platforms. The campaign
also includes an ad-funded TV programme, Back to Mine, in
partnership with ITV.
Financial Position
As at 29 September 2018, net debt was approximately GBP109m
(FY18: GBP130m). Daily average net debt across the period amounted
to GBP104m (FY18: GBP115m).
Comment from Nick Wilkinson, Dunelm's Chief Executive:
"We delivered a good trading performance in the first quarter.
Our positive LFL growth highlights the strength of our customer
offer which we are continually working hard to improve as we focus
on our core business again under one brand, with one platform and
one supply chain.
"We continue to improve the multichannel experience for our
customers and our stores play a vital role in this. I am pleased at
the progress we are making with tablet-based selling in store to
offer our full product range to all our customers.
"Whilst we are cautious about the months ahead due to the level
of market and customer uncertainty, I see plenty of opportunity
over the medium term as we continue our journey to become the
leading multichannel retailer in our sector, helping our customers
create homes they love."
Ends
For further information please contact:
Dunelm Group plc 0116 2644439
Nick Wilkinson, Chief Executive
David Stead, Chief Financial Officer
MHP Communications 020 3128 8570
Tim Rowntree / Simon Hockridge / Alistair dunelm@mhpc.com
de Kare-Silver
Next scheduled events:
The Q2 trading update will be on 16 January 2019. The half year
results announcement will be on 20 February 2019.
Notes
1. Quarterly sales and margin analysis (totals include Worldstores):
52 weeks to 29 June 2019
Q1 Q2 H1 Q3 Q4 H2 FY
---------- --- --- --- --- --- ---
Total sales GBP248.2m
---------- --- --- --- --- --- ---
LFL Stores growth 1.3%
---------- --- --- --- --- --- ---
LFL Online growth 33.3%
---------- --- --- --- --- --- ---
Total LFL growth 4.2%
---------- --- --- --- --- --- ---
Total Dunelm growth 5.8%
---------- --- --- --- --- --- ---
Total Group growth 0.1%
---------- --- --- --- --- --- ---
Gross margin growth* +130bps
---------- --- --- --- --- --- ---
52 weeks to 30 June 2018
Q1 Q2 H1 Q3 Q4 H2 FY
---------- ---------- ---------- ---------- ---------- ---------- ------------
Total sales GBP247.9m GBP297.5m GBP545.4m GBP268.2m GBP236.5m GBP504.7m GBP1,050.1m
---------- ---------- ---------- ---------- ---------- ---------- ------------
LFL Stores growth 6.5% 1.1% 3.5% 1.2% -4.6% -1.6% 1.0%
---------- ---------- ---------- ---------- ---------- ---------- ------------
LFL Online growth 46.2% 30.5% 36.8% 35.7% 41.8% 38.7% 37.9%
---------- ---------- ---------- ---------- ---------- ---------- ------------
Total LFL growth 9.3% 3.4% 6.0% 4.6% 0.1% 2.4% 4.2%
---------- ---------- ---------- ---------- ---------- ---------- ------------
Total Dunelm growth 14.3% 9.4% 11.4% 9.0% 3.7% 6.4% 8.9%
---------- ---------- ---------- ---------- ---------- ---------- ------------
Total Group growth 24.8% 13.6% 18.4% 5.1% -1.4% 1.9% 9.9%
---------- ---------- ---------- ---------- ---------- ---------- ------------
Gross margin growth -220bps -155bps -180bps -15bps -50bps -20bps -90bps
---------- ---------- ---------- ---------- ---------- ---------- ------------
*estimated Group margin growth
Notes to Editors
Dunelm was founded in 1979 as a market stall business, selling
ready-made curtains. The first shop was opened in Leicester in 1984
and over the following years the business developed into a
successful chain of high street shops before expanding, following
the opening of the first Dunelm superstore in 1991, into broader
homewares categories. Dunelm is now a multi-channel retailer, with
Dunelm.com being launched in 2005 and the acquisition of the
Worldstores Group in 2016 accelerating this further.
Dunelm is market leader in the GBP13bn UK homewares market and
active in the GBP11bn UK furniture market. It currently operates
172 stores, of which 169 are out-of-town superstores and 3 are
located on high streets, and also trades online through
www.dunelm.com. Dunelm employs approximately 10,000 colleagues and
sells around 30,000 product lines in store, increasing to around
60,000 online.
Dunelm, "The Home of Homes", offers a customer proposition of
style, value, quality and ease of shopping. From its textiles
heritage, in areas such as bedding, curtains, cushions, quilts and
pillows, Dunelm has broadened its product range to a complete
homewares offer including the likes of kitchenware, dining,
lighting, seasonal, wall art and rugs. Dunelm is one of the few
national retailers to offer an authoritative selection of curtain
fabrics on the roll, and owns a specialist UK facility dedicated to
producing made-to-measure curtains.
The product range includes many exclusive, own brand designs and
owned premium brands such as Dorma and Fogarty. This is augmented
by a range of other well-known brands and license agreements.
Dunelm has been listed on the London Stock Exchange since
October 2006 (DNLM.L) and has a current market capitalisation of
approximately GBP1.1bn.
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END
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