Dunelm sees FY profit at lower end of market expectations

(Sharecast News) - Homeware retailer Dunelm reported a rise in third-quarter sales on Thursday but cautioned that full-year profit would be towards the lower end of consensus expectations as events in the Middle East have dented consumer confidence. In an update for the third quarter, the company said total sales rose 2.1% year-on-year to £472m, with digital participation up 2 percentage points to 43%. Total year-to-date sales were up 3.1% at £1.4bn.

Dunelm said Q3 started well, with growth in line with the first half performance, following a good Winter sale and a positive response to new Spring ranges. "The universal appeal of our offer continued to resonate with customers, however more recently, and particularly in March, we experienced a period of broad-based softening," it said.

The company highlighted a strong calendar of events for the fourth quarter and confidence in its ability to continue to deliver a "compelling proposition" to customers. However, it said global events have resulted in "a more uncertain external environment" and it is not assuming any immediate improvement to consumer confidence.

As a result, pre-tax profit for FY26 is expected to be towards the lower end of consensus expectations of £210m to £217m.

Chief executive Clo Moriarty said: "We saw further sales growth in Q3, against an uncertain backdrop for both customers and businesses.

"Although the external environment is not helpful in the short term, we continue to focus on the areas within our control - strengthening our proposition while operating efficiently and effectively. Alongside this, we are making good progress building our long‑term growth plans with some exciting developments beginning to emerge, including a much stronger store opening pipeline and some encouraging early results from our recently launched app.

"Our final quarter provides multiple opportunities for Dunelm to stay front of mind for customers, including our popular Summer Sale. We remain confident that our comprehensive offer will continue to resonate with homelovers."

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