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Dunelm Group PLC on Thursday reported a 8.2% decline in first quarter sales, but backed its annual guidance.
For the 13 weeks to October 1, total sales for the soft furnishings retailer came in at £356.7 million, down from £388.8 million a year before and £386.7 million in the immediately previous quarter.
This was "as expected, given the very strong comparative period, with Q1 last year benefiting from pent up demand and our rescheduled Summer Sale", Dunelm explained.
Dunelm said digital sales made up 33% of total sales in the quarter, in line with the same period last year, and it is continuing to see "robust sales from its total retail system across its categories".
Looking ahead, it noted a "challenging" macroeconomic environment, including recent volatility in exchange rate movements.
However, Dunelm said it is "very well hedged" for the remainder of the year. It reiterated the annual guidance from last month, which said it expects to achieve a margin of around 50% in the current financial year. It said gross margin for financial 2022 slipped to 51.2% from 51.6% the year before.
Chief Executive Officer Nick Wilkinson said: "Dunelm has emerged from the last two years as a bigger, better business, with total sales up 36% against the same period pre-Covid."
Last month, Dunelm reported total sales in the financial year that ended July 2 were up 18% at £1.58 billion from £1.34 billion the year before. Pretax profit increased 35% to £212.8 million from £157.8 million.
Shares were down 2.5% at 785.31 pence each on Thursday morning in London.
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