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13 Feb 2019 | 07:26

Dunelm profits rise 17% as challenges from Worldstores acquisition fade

Homewares retailer Dunelm Group said Wednesday profits grew 17% as the cost and integration challenges from the Worldstores acquisition were no longer weighing down performance.

For the 26-weeks period ended 29 December, reported pre-tax profit rose 16.7% to £56.3m and the total revenue grew 1.2% to £545.4m. Total like-for-like revenue grew 6.9% to £473.9m, with store revenue increasing 3.8% and online 35.8%.

The multichannel proposition continued to develop and represented 15.7% of total revenues, up 3.9% on last year, the company said.

Gross margin improvement of 170 basis points on improved sourcing, FX benefits and as lower margin sales from the Worldstores business ended. 'The additional costs and integration challenges that came with the Worldstores acquisition are now behind us and the benefits can be seen in the continuing strong growth in our online revenue and further strengthening of our multichannel credentials,' the company said. The Interim dividend was increased by 7.1% to 7.5p a share. The company said it was 'confident' of delivering market expectations for the full year 'assuming no material change in the macro-economic environment.' Analysts forecasts profit before tax for the full year in the range of £114m to £118m. 'We traded well through our key Winter Sale period and remain pleased with our performance to date. As previously highlighted, we are cautious about the outlook for the remainder of the financial year due to the continuing political uncertainty in the UK,' said Nick Wilkinson, Chief Executive Officer.

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