Dunelm puts in a comforting showing

All in all, Dunelm reported another year of sales and profit growth - something it's done consistently since its initial public offering in 2006. The group also opened six new outlets, taking the store estate to a total of 152, and has another nine in the pipeline. Gross margins grew by 60 basis points to 49.8 per cent and operating profits rose 6.6 per cent to £129m. The business also remains highly cash-generative: free cash flow improved by 26.9 per cent to £110m by the financial year-end - hence the flexibility for another one-off investor return.

But it's no secret that Dunelm had a tough first half, particularly during the second quarter when unusual weather patterns led to sluggish Christmas sales and lower-than-expected top-line growth. Thankfully, productivity initiatives kept margins intact which has helped protect profitability. But like-for-like sales growth of just 2.5 per cent last year still came in some way behind the 5.8 per cent growth rate reported in FY2015.

Meanwhile, chief executive John Browett said his first year in the hot seat was "extremely busy" and it's true, although most of his ideas for growing the business have yet to show up in the numbers. These include opening more London-based stores, improving access to the company's website and trialling different merchandising tactics to help customers shop in store. The group has also opened a new warehouse in Stoke, which should double capacity and reduce costs as storage arrangements with third parties are curtailed.

Analysts at Peel Hunt still expect pre-tax profits of £132m for the year ending June 2017, giving EPS of 51.1p. That compares with £129m and 50.3p for 2016.