UK homeware retailer Dunelm Group has set out a three-year plan to cut around £100m ($135.6m) in costs.
The strategy, named Winning Hearts & Homes, was announced alongside preliminary results for the financial year ended 27 June 2026.
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Dunelm said it would strip “£100m of unproductive costs from the FY26 base by FY29” and channel that amount into growth initiatives.
The retailer said its objectives include lifting customer loyalty and spend through repeat visits and share of wallet, together with “a return to sustainable mid-to-high single digit sales growth, supported by increasing LFL [like for like] sales, digital acceleration and store investment.”
It added that it plans to invest while maintaining “adjusted PBT [profit before tax] margin of 11% and return on capital employed of 30%”.
Dunelm CEO Clo Moriarty said: “We want to reach new customers and deepen our connection with existing ones, earning more loyalty and becoming the specialist they turn to for every mission in the home, whether they are refreshing a room, solving a practical problem, or creating a space they love.”
Dunelm also pointed to non-recurring costs of £30m-£40m over the next two years, mostly linked to foundational infrastructure, which will be classed as adjusting items.
Capital expenditure is set to increase too, with the company citing “£125m above our recent run-rate across the next three years”, covering store estate expansion and renewal.
Three growth areas underpin the plan.
The first is broadening and simplifying the homewares offer, with changes to ranges, pricing structure and use of the Dunelm brand across products.
The second is building out omnichannel experiences, including up to ten new store openings a year over three years across “100 potential locations”, plus more than 50 renewals planned by FY28.
The third is reshaping internal capabilities through simplification, capability investment, process improvements and wider technology use.
In FY26, Dunelm reported revenue of £1.82bn, up 3.1%.
Operating profit rose to £224.9m from £222m in FY25, an increase of £2.9m.
Profit after tax fell slightly to £155.5m from £156.3m the year before.
Dunelm called FY26 trading resilient despite a tough year and said it remains confident in its business strength and long-term prospects, despite a weaker start to FY27 after prolonged hot weather hit trading in the first six weeks.
