Dunelm Group plc (LSE:DNLM) has reported total sales of £433 million for the first quarter of its 2027 financial year, representing a 1.1% increase year-on-year.
Trading conditions were uneven across the quarter, with an initially slow start giving way to stronger performance in the latter weeks of the period.
The UK homewares retailer said sales were down approximately 3% in the first six weeks, before rebounding to growth of around 4% in the final seven weeks.
Exceptionally warm weather during the early part of the quarter was cited as a key factor suppressing demand across certain seasonal product categories.
Store-enabled like-for-like sales declined by 0.8% compared with the same period last year, even as total sales edged higher across the group’s broader retail operations.
Dunelm recorded a 10 basis point improvement in gross margin during the quarter, supported in part by favourable foreign exchange movements.
The company said its sales performance continued to outpace that of the wider homewares market, which it described as soft during the reporting period.
Made-to-measure services recorded double-digit sales growth during the quarter, standing out as one of the stronger performing areas within the business.
The cook-and-dine category also showed improvement following recent product range reviews and the introduction of updated merchandise.
Digital sales accounted for 41% of total revenue, up one percentage point year-on-year, reflecting continued growth across online shopping, home delivery and Click and Collect services.
Customer satisfaction scores improved by 0.5 percentage points during the period, according to the retailer’s own measures.
Dunelm continued advancing its Winning Hearts and Homes strategy, which encompasses investment in stores, digital infrastructure and internal operational processes.
The group progressed its store renewal programme and new store openings, including a substantial refurbishment of its Doncaster location.
Dunelm also expanded the rollout of radio-frequency identification technology across selected product categories to improve inventory visibility and stock availability.
The company introduced artificial intelligence-enabled tools within its customer contact centre as part of broader efforts to improve service operations.
Management maintained its full-year expectations, with adjusted profit before tax for FY27 forecast to remain broadly in line with the previous financial year.
First-half profitability is expected to fall below the corresponding period last year, with the financial benefits of strategic investments weighted towards the second half.
The group said it remains focused on executing its store, digital and operational investment programmes while monitoring conditions across the UK homewares sector.
Founded in 1979 and headquartered in Leicester, Dunelm operates 204 stores across the UK and Ireland and employs approximately 12,000 people.
The group’s product range spans furniture, bedding, curtains, blinds, kitchenware, lighting and home accessories, with the majority of sales generated through own-brand merchandise.
