Dunelm Group (LON:DNLM) Announces Quarterly Earnings Results

Dunelm Group (LON:DNLM) posted its quarterly earnings data on Tuesday. The company reported GBX 42 earnings per share (EPS) for the quarter, Digital Look Earnings reports. Dunelm Group had a net margin of 8.86% and a return on equity of 96.64%.

Here are the key takeaways from Dunelm Group’s conference call:

• Strong H1 cash and margin performance—sales up 3.6%, gross margin improved 60bps to 53.4%, headline free cash flow of £171m, and the board declared an interim dividend (17p) plus a special dividend (25p) and a small buyback, supporting shareholder returns.
• Operating costs pressured H1 profit—net operating costs rose £32m to £375m (volume, wage inflation and phasing of investments), which drove PBT to £114m (down £9m); management says costs should moderate in H2 but cost dynamics remain a near-term risk.
• Strategic customer push—new Chief Customer Officer appointed, app officially launching this month with high early engagement, and a targeted plan to improve personalization and lift share of wallet (current loyal customers represent two‑thirds of sales but only ~15% of their homewares spend).
• Operational issues identified and being fixed—furniture availability shortfall traced to forecasting inputs has been corrected (availability now >95%), and a packaging change cut one-person delivery complaints by ~20%, boosting CSAT and reducing cost of damages.
• Estate and capex stance—CapEx guidance reduced to ~£40m (from ~£50m) with slower store openings this year but a stronger FY27 pipeline and a continued target of ~5–10 openings annually as the group reappraises formats to expand reach.

Dunelm Group Trading Up 0.8%

LON DNLM opened at GBX 960 on Thursday. The company has a debt-to-equity ratio of 236.84, a current ratio of 1.04 and a quick ratio of 0.16. The stock has a market capitalization of £1.95 billion, a P/E ratio of 12.50, a PEG ratio of -10.32 and a beta of 1.18. The firm’s 50-day moving average is GBX 1,052.10 and its two-hundred day moving average is GBX 1,110.79. Dunelm Group has a 12 month low of GBX 836.61 and a 12 month high of GBX 1,249.

Analysts Set New Price Targets

A number of analysts have recently issued reports on DNLM shares. UBS Group reaffirmed a “buy” rating and issued a GBX 1,360 price target on shares of Dunelm Group in a research note on Friday, October 17th. Panmure Gordon dropped their price objective on shares of Dunelm Group from GBX 995 to GBX 830 and set a “sell” rating for the company in a research note on Monday, January 19th. JPMorgan Chase & Co. raised their target price on shares of Dunelm Group from GBX 1,140 to GBX 1,240 and gave the stock a “neutral” rating in a research note on Tuesday, October 28th. Jefferies Financial Group upgraded Dunelm Group to a “buy” rating and set a GBX 1,075 price target for the company in a research report on Monday. Finally, Shore Capital Group reduced their price objective on Dunelm Group from GBX 1,300 to GBX 1,200 and set a “buy” rating on the stock in a research report on Tuesday, January 27th. Seven equities research analysts have rated the stock with a Buy rating, one has given a Hold rating and one has given a Sell rating to the company. According to data from MarketBeat.com, Dunelm Group currently has a consensus rating of “Moderate Buy” and a consensus price target of GBX 1,216.67.

Insider Activity

In related news, insider Karen Witts acquired 10,790 shares of the firm’s stock in a transaction dated Monday, December 1st. The shares were purchased at an average cost of GBX 1,104 per share, for a total transaction of £119,121.60. Company insiders own 34.15% of the company’s stock.

Dunelm Group Company Profile

Dunelm is the UK’s market leader in homewares with a purpose ‘to help create the joy of truly feeling at home, now and for generations to come’. Its specialist customer proposition offers value, quality, choice and style across an extensive range of c.70,000 products, spanning multiple homewares and furniture categories and including services such as Made to Measure window treatments.

The business was founded in 1979 by the Adderley family, beginning as a curtains stall on Leicester market before expanding its store footprint.