Dunelm Group (LON:DNLM) shares fell over 12 percent in early trading on Tuesday, after profits slipped in the half year to December 2017.
Profit before tax and exceptional costs fell to £60 million over the period, down from £65.2 million a year ago. Its profit margin fell 1.8 percentage points to 48.6 per cent, attributed to a fall in sales at its latest acquisition Worldstores.
However sales figures were positive during the period, with total sales up 18.4 percent to £545.4 million and like-for-like sales rising 6 percent. Comparable sales grew 36.8 percent online, with sales from the group’s website now making up 18.5 percent of its total revenue.
Andy Harrison, Dunelm’s chairman, commented:
“Our gross margin in the first half was lower due to the mix effect of acquired Worldstores sales and a higher proportion of end of season and seasonal products. We expect a more stable margin performance in the second half, which, together with reduced losses and increased integration benefits from the acquisition, should deliver good full year profit growth.
“The Board has increased the interim dividend by 7.7 percent to 7.0 pence per share, reflecting both Dunelm’s future profit growth potential and our strong cash generating capability.”
The mixed results sent Dunelm Group shares down in early trading, currently down 9.05 percent at588.00 (0850GMT).
