Retailers remain bullish as tills keep ringing

Retailers Frasers Group and Dunelm have reported strong results and bullish confidence despite the cost-of-living pressures facing consumers.

Frasers, which owns a host of retail brands including Sports Direct and Flannels, increased sales by more than £1bn, to £4.75bn.

It achieved adjusted pre-tax profits of £345m and says its “conservative” forecast is to hit £450m-£500m this year.

Frasers chief executive Michael Murray said: “It’s clear that our elevation strategy is working and we are building incredible momentum with new store openings, digital capabilities and deeper brand partnerships across all of our divisions.

“We’ve got the right strategy, team and determination to keep driving our business from strength to strength.”

It has recently opened two large stores – Sports Direct in Birmingham and Flannels in Liverpool, a seven-floor, 120,000 sq ft city centre site.

Shirebrook-based Frasers is also looking further afield. Murray said the group has “extensive ambitions to grow the business outside of the UK” and will be looking for further international expansion through acquisitions, joint ventures and organic openings.

Homewares specialist Dunelm increased its sales by 16%, to £1.55bn, with both revenues and profits finishing the year “slightly ahead” of expectations. It will reveal its profit figure in September, but it will be above the analyst consensus of £207m.

Dunelm chief executive Nick Wilkinson said: “Dunelm is a much bigger and stronger business than before the pandemic, with sales over 40% higher, due in large part to the huge strides we have made to develop our digital capabilities. Our growth continues to be driven by increasing market share as our customer base further expands.

Wilkinson acknowledged that he “cannot predict exactly how consumers will respond to the increasing pressures on their finances”, but is confident the Leicestershire-headquartered retailer’s ranges and price points will enable it to continue to perform well.

He said: “The business has successfully navigated previous periods of consumer uncertainty. With the inherent strength of our business model and strong operational grip, we have never been more confident about our ability to make the right long-term decisions for all of our stakeholders and to continue to grow our market-leading position.”