Dunelm (DNLM) shares sprang back to life following a set of annual numbers that largely matched up to its fourth-quarter statement. But shareholders will be glad of no surprises after a “difficult and disappointing” year. The group has closed the standalone website associated with its Worldstores acquisition, although Worldstores is still acting as a drag on the wider group’s profitability. Losses from that business have narrowed to £8.4m, compared with losses of £10.7m this time last year, but underlying pre-tax profits still fell 6.7 per cent to £102m. The group bought Worldstores out of administration for a nominal sum, but estimates the integration has cost as much as £30m.
Thankfully, the balance sheet is looking a tad more robust 12 months on, particularly from a cash perspective. Lower working capital, combined with tighter capital expenditure and a reduced year-end inventory position allowed for a 24 per cent rise in operating cash flow to £98.5m, as well as a whopping 273 per cent surge in free cash flow to £52.9m.
Analysts at Peel Hunt expect pre-tax profits of £111m for the year ending June 2019, giving EPS of 43p, up from £102m and 36.2p in FY2018.
| DUNELM (DNLM) | ||||
| ORD PRICE: | 545p | MARKET VALUE: | £1.10bn | |
| TOUCH: | 545-547p | 12-MONTH HIGH: | 760p | LOW: 461p |
| DIVIDEND YIELD: | 4.9% | PE RATIO: | 15 | |
| NET ASSET VALUE: | 67p* | NET DEBT: | 92% | |
| Year to 30 Jun | Turnover (£bn) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
| 2014 | 0.73 | 116 | 44.0 | 20.0 |
| 2015 | 0.84 | 123 | 47.5 | 21.5 |
| 2016 | 0.88 | 129 | 50.5 | 25.1 |
| 2017 | 0.96 | 92.4 | 36.3 | 26.0 |
| 2018 | 1.05 | 93.1 | 36.3 | 26.5 |
| % change | +10 | +1 | - | +2 |
| Ex-div: | 15 Nov | |||
| Payment: | 07 Dec | |||
| *Includes intangible assets of £28.6m, or 14p a share | ||||
