Adderley family to collect £9.5m dividend as Dunelm profits jump 9pc

The Adderley family will be rewarded with a dividend of £9.5m after Dunelm Mill, the homewares retailer, posted a strong set of profits.

A little over 30 years ago Bill and Jean Adderley set up a market stall in Leicester selling curtains.

But its chief executive said that part of the reason why it had managed to increase sales by 9.3pc to £539m in the last financial year was because it was attracting an increasing number of John Lewis customers.

Nick Wharton, the first non-Adderley family chief executive, who took over last year, said: "We see a huge range of customers come in through our stores, from very affluent John Lewis customers buying towels for their second guest bathroom, to people who aren't going on holiday but want to treat themselves with an indulgent cotton-rich towel."

In the year to July 2, the pre-tax profits increased 9pc to £83.6m and the company declared a full-year dividend of 8p a share, up from 5p.

The Adderley family, who own 59pc of the shares, will receive £9.53m.

Mr Wharton said: "As a growing business we generate more than enough cash. It also reflects the nature of our confidence in the business."

He said that there was some reason to think "there will be a chink of optimism in 2012", but that it was planning cautiously.

Like-for-like sales fell 0.6pc but Dunelm said it had increased its share of the declining market, citing industry figures showing the sector has contracted by 1.9pc in the year.

Mr Wharton said its value proposition was continuing to help it gain market share. "It's the sheer breadth of our offer. We stock 300 different styles of towels, from a 99p face cloth to a £30 Dorma bath sheet."

Nick Bubb, analyst at Arden, said Dunelm was "making a good fist of things".

The shares increased nearly 6pc to 451.9p.