Dunelm defies British retail gloom as it impresses in 2019

A number of internal changes and initiatives have turned the retailer around following a tough 2018.

Article updated: 5 December 2019 12:00pm Author: Helal Miah

  • Gross margins stronger than expected as a result of sourcing gains.
  • Costs remain under control resulting in the prospect that profits will easily surpass £101m made in the full year.
  • Shares responded positively to today’s news with a 15% rise in early trading.

Bucking the retail gloom is Dunelm who has had an impressive 2019 so far. The latest update results in an upgrade to full year profits, which had been unheard of in the retail sector for some time. The group did go through a tough 2018 but have bounced back following restructurings put in place to streamline operations, offering better product lines, revamping the look of their stores and more of a focus on online sales. We are now seeing the benefits coming through as sales seem to be strong both in physical stores and online.

The retail environment is full of doom and gloom, further evidenced by the “gating” of M&G’s retail sector exposed property fund. But there are pockets of hope with the likes of Dunelm, Next and WH Smith, all of whose strategies should be well studied by other retail management.

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Helal Miah portrait photo
Helal Miah

Investment Research Analyst

After graduating with an economics degree from University College London, Helal started his career within private banking at Smith & Williamson Investment Management and later held analyst and fund manager roles with the Industrial Bank of Japan, Schroders and Mitsubishi Corporation. He is a chartered fellow of the Chartered Institute for Securities & Investment. 

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