Dunelm shares plunge 11pc after profits shock

SHARES in Dunelm crashed yesterday after bosses issued a shock profit warning.

The soft- furnishings retailer warned that full-year profit would fall below the £109.3m in 2017 after ‘unexpectedly challenging’ conditions in the fourth quarter.

The warning wiped more than £139m off the value of the company, which started life as a market stall in 1979.

Falling footfall in the past three months led to a 4.7pc drop in likefor-like store sales, although investors will take some comfort from the 43.7pc boost in online sales over the same period.

Total sales for the year are expected to come in a little over £1bn, up 10pc on the year before but below expectations.

Chief executive Nick Wilkinson said: ‘We will learn from recent trading and I remain optimistic about our ability to deliver strong sales and profit growth in future.’

While Dunelm did not blame the fall in sales on the freeze this year – nicknamed the Beast from the East – analysts say it almost certainly played a key role.

John Stevenson, from Peel Hunt, said: ‘ While it sometimes seems too convenient to blame the weather, it does have an impact on short-term trading updates, although it tends to even out over the longer term.’

Dunelm shares plunged 11.2pc, or 69p, to 545p.

The FTSE 100 rose 0.18pc, or 13.54 points, to 7730.28, while the

FTSE 250 was up 0.58pc, or 121 points, at 21110.53.

A group of anonymous private equity and infrastructure investors have reportedly approached

BT about buying a stake in Openreach, which operates Britain’s national phone and broadband grid. While a deal is far from certain, analysts say it could be worth as much as £24.9bn.

The speculation provided a boost for BT shares, which have been trading at six-year lows. At closing, BT shares were up 3.4pc, or 6.8p, to 209.95p.

Berenberg urged investors to ditch Royal Mail shares, giving them a ‘sell’ rating.

The German investment bank believes uncertainty surrounding the EU’s new data protection laws – the General Data Protection Regulations – means firms will temporarily cut back on their postal marketing, and therefore cause mail volumes to fall.

Royal Mail shares, which propped up the FTSE 100, fell 2.8pc, or 15p, to 530.4p.

More than £336m was wiped off the value of Centamin after the gold miner cut its full-year production guidance.

The FTSE 250-listed miner says 2018 gold production will be between 505,000 and 515,000 ounces, down from 580,000, as a result of lower grade ore and equipment availability problems at its Sukari mine.

Hunter Hillcoat, an analyst at Investec, said: ‘The company has rebuilt its reputation to one for reliability, so it is disappointing to see such a substantial downgrade just three weeks after it reaffirmed its previous 2018 guidance.’

Shares plummeted 18.3pc, or 29.15p, to 130.2p.

Peel Hunt downgrades comparison website Moneysupermarket from ‘buy’ to ‘add’ after its shares jumped by more than 23pc in the past two months. Shares edged down 0.3pc, or 1.1p, to 321.5p. On Aim, market research firm

YouGov has snapped up the remaining 80pc of sports research agency SMG Insight that it did not own in a deal worth up to £21m. Jessica Pok, an analyst at Peel Hunt, said: ‘The acquisition, albeit a small one, will provide YouGov the opportunity to develop new syndicated data products for the sports industry.’ Shares edged up 0.7pc, or 3p, to 438p.