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Dunlem says 'We've got too much cash'
Interiors chain Dunelm has told shareholders that it has more cash than it needs for the business and will boost dividends by 14.3%.
The 123 store chain saw net cash jump from £34.3m to £49.9m in the six months to 31 December and is increasing the interim dividend from 3.5p to 4p totally £8.1m.
Sales rose by 8.8% to £299.9m with like for like sales 1.1% higher. Gross margins edged up 10 basis points to 49.2% and pre-tax profits rose 7.8% to £52.2m.
'The group continues to generate internally the funds required to invest in all aspects of its growth programme, and net cash at the end of the period was £49.9 million. The board's confidence in the continuing cash generation of the business has led us to declare a 14% increase in the interim dividend to 4.0p. The board keeps under review the requirement for cash resources to support the group's continued development, and is committed to returning excess cash to shareholders where appropriate,' says Geoff Cooper, Dunelm chairman.
The group said performance had been helped by increased marketing, more stores, the roll out of click and collect, improved economies of scale in buying and an expanded occasional furniture offer.
No indication of 2012 trading was given.