HOMEWARES retailer Dunelm reported strong online sales and an upbeat start to the year.
But it said its performance was dented by weaker customer numbers through February and March.
The group, which has a store at the Ringway Centre in Huddersfield and more than 120 outlets in total selling kitchenware, bedding and rugs, saw like-for-like sales edge up by 0.6% in the 13 weeks to March 31.
That compares with a 1.1% improvement in the 26 weeks to December 31.
Dunelm, which began life as a Leicester curtain stall in 1979, said footfall was “depressed” in February and March at its predominantly out-of-town stores after a strong January.
While the group gave no explanation, the decline in customer numbers came at a time when petrol prices are on the rise, breaking the 140p-a-litre barrier for the first time last month.
But turnover was strengthened by the addition of new superstores in Exeter and Stafford – taking total sales up by 10.7% in the third quarter compared to 8.8% in the first half – as part of a drive to increase its portfolio to a total of 200 stores.
Despite the slowdown in same-store sales, the group said its financial position had not changed as it managed to increase its profit margins by 0.3% in the third quarter.
Nick Wharton, Dunelm chief executive, said: “It is prudent to remain cautious about the wider economy and, recognising its impact on consumer confidence, we will maintain our disciplined approach to the management of gross margin and operating costs.
“However with a clear growth strategy and strong pipeline of new stores ahead, we remain confident in the future prospects for the business.”
Dunelm opened its Greenford, west London, store last week and a new store in Cambridge is due to open before the end of June. That will bring the total number of new stores this financial year to 15.
The homewares sector has suffered as consumers cut down on non-essential purchases – but Dunelm has remained resilient due to its value-for-money offer.
Shares closed 7.5p higher at 521.5p.
