Dunelm Group (DNLM) H1 2026 earnings summary

Executive summary

• Achieved 3.6% year-on-year sales growth to £926.3m for H1, with strong Q1 growth and softer Q2, now rebounding.

• Gross margin improved by 60bps to 53.4%, driven by FX gains and disciplined promotional activity.

• Market share increased to 7.9%, outpacing the UK homewares and furniture market.

• Digital participation rose by 2 percentage points to 41%, supported by new product ranges and app launch.

• Profit before tax declined 7.5% to £114.0m, reflecting higher operating costs and softer Q2 trading.

Financial highlights

• Revenue reached £926.3m, up 3.6% year-on-year.

• Gross margin improved to 53.4% from 52.8% year-on-year.

• Free cash flow was £171.4m, aided by a £93m timing benefit.

• Interim ordinary dividend of 17.0p per share (up 3%) and special dividend of 25.0p per share declared.

• Net cash at period end was £13.3m, with underlying net debt at 0.3x EBITDA.

Outlook and guidance

• Confident in delivering full-year PBT in line with consensus expectations (£214m average).

• Early Q3 trading is encouraging, with sales growth similar to H1.

• CapEx guidance reduced to £40m for the year, reflecting timing of new store openings.

• Effective tax rate expected to remain 50–100bps above the headline rate.

• Launch of new app and recovery plans for furniture availability planned for H2.