Investors
DUNELM THE HOME OF HOMES
Our purpose is to help everyone create a home they love. We are the UK’s #1 homewares retailer with a growing presence in the furniture market. We love creating homes with products that offer choice, value, quality and style, and services that help our customers. We work together to give our customers experiences that are friendly, local, helpful, and build relationships.
Capital Markets Day Presentation
2020 Performance Summary
ACTIVE CUSTOMER GROWTH1
+1.3%
(2019: +8.5%)
+8.8% for first eight months of the year
TOTAL SALES
–3.9%
(2019: +4.8%)
+6.8% for first eight months of the year
FREE CASH FLOW2
£174.7m
(2019: £152.8m)
PROFIT BEFORE TAX3
£109.1m
(2019: £125.9m)
FY20 Highlights
- Response to the crisis highlighted the resilience of our business model, the strength of our balance sheet, the importance of our shared values and our digitally enabled Customer 1st strategy, allowing us to innovate at pace.
- Total sales increased in the eight months to February by 6.8%, supported by an 8.8% increase in rolling 12-month unique active customer numbers.
- Online (home delivery) sales grew 105.6% in the fourth quarter.
- Gross margin of 50.3% up 70 bps year-on-year, with gains from sourcing initiatives partially offset by increased clearance activity following the store closure period.
- Full year reduction in PBT reflects impact of Covid-19 and the store closure period.
- Free cash flow generation of £174.7m, including c.£80m of exceptional working capital benefits related to our response to Covid-19, which are expected to largely reverse in FY21.
- Robust balance sheet with year-end net cash of £45.4m, access to £175m of approved banking facilities, and confirmed COVID Corporate Financing Facility (CCFF) eligibility.
- Unique active customers who have shopped in the last 12 months, based on management estimates using Barclays data.
- To ensure comparability following the implementation of IFRS 16, free cash flow is defined as net cash generated from operating activities less capex (net of disposals), net interest paid, interest on lease liabilities and repayment of lease liabilities.
- FY20 PBT on IFRS 16 basis; FY19 on IAS 17. The impact of IFRS 16 on FY20 PBT is a reduction of £2.3m.
Investment Proposition
Well positioned for sustainable growth
Fundamentally, our reasons to invest have changed very little since the business was floated. They continue to reflect our shared values and our latent business strengths.
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A brand appealing to a wide range of consumer segments, with potential for significant market share gains in a large, fragmented market.
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A distinctive and specialist offer – quality, value, and style from a product portfolio that is largely own brand and sourced from long-term committed suppliers – available to browse, buy, and fulfill across channels.
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Our online platform and physical stores are integrated and complementary. We have built agile and scalable technology, a flexible supply chain and an efficient store estate. A significant opportunity to grow through digital capabilities integrated with our local store colleagues.
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A highly cash generative business with a strong balance sheet, no legacy issues (no defined benefit pension and low cost lease commitments), agility to invest and a track record of returning surplus cash.
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Entrepreneurial origins alive and well with a total commitment to doing the right thing for the long term, and to being a good company and a great place to work.