Fun in the sun heats demand for Dunelm's garden furniture
The homewares retailer, which sells items ranging from armchairs to kitchenware, reported total sales of £415 million for the 13-week period to June 28, up from £399 million last time.
It attributed the good results to solid demand during its summer sale, which included both full-priced and discounted products. The warm weather also helped Dunelm, boosting sales of outdoor furniture and decorative outdoor accessories, while its furniture category continued to 'perform particularly strongly'.
The company, which named the Sainsbury's executive Clodagh Moriarty as its new chief executive last week, is expected to report pre-tax profit in line with forecasts, which analysts have put at £210 million.
However, Dunelm cautioned that there were still no clear signs of a sustained recovery in consumer confidence.
Nick Wilkinson, who will step down as chief executive of Dunelm in October, said: 'Amid muted consumer confidence, we are not standing still waiting for a recovery. We are instead focused on delivering relevance to our customers.'
He added that the company remained confident as it progressed with ambitions to gain further market share. The retailer opened four stores during the fourth quarter, including its first inner-London store at Westfield in White City, another small superstore in Trowbridge, and large superstores in Manchester and Southend.
Full-year sales also rose 3.8 per cent year-on-year to £1.8 billion. The Leicestershire-based retailer credited the uplift to the introduction of AI-powered search and recommendations on its website 'driving increasingly personalised experiences'.
Dunelm acquired the Dublin-based Home Focus at Hickeys and its 13 stores in November last year, marking its entry into the Irish market. It also took over the luxury home decor company Designers Guild in April, which supplies fabrics under exclusive licence from the royal family.
Shares in the FTSE 250 retailer are up 14 per cent this year and rose another 46p, or 4 per cent, to close at £11.87 on the positive update.
Meanwhile, another furniture retailer also showed resilience against a gloomy economic backdrop. DFS Furniture recorded a 5.8 per cent increase in gross sales for the year to June 29. Its order intake rose 10 per cent year-on-year, 'demonstrating significant outperformance of the market that remains subdued'.
Tim Stacey, chief executive of DFS, said: 'Looking forward, we are confident that the group is well positioned to drive attractive returns for shareholders as the market recovers and we remain focused on delivering our medium-term ambition of £1.4 billion revenue and 8 per cent PBT margins.'
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