Shares in Dunelm tumbled as the homewares retailer warned over profits after experiencing “challenging” trading conditions in the fourth quarter.
The group said reduced footfall has seen like-for-like store sales drop 4.7% in the period so far.
It compares with growth of 1.2% in the third quarter.
As a result, Dunelm now expects underlying profits for the year to be “moderately below” last year’s £109.3 million.
Shares crashed 10% following the unscheduled announcement.
“Following a good performance in the first three quarters of the financial year, the group has recently experienced trading conditions which have been materially more challenging than had been expected, within a soft homewares market. These conditions have impacted our trading performance,” Dunelm said.
The group expects total sales for the full year to be in the region of £1 billion, an increase of approximately 10% on 2017.
We will learn from recent trading and I remain optimistic about our ability to deliver strong sales and profit growth in the futureDunelm boss Nick Wilkinson
Like-for-like online sales are up 44%, leading to total like-for-like sales growth of 0.1% in the quarter to date, the company added.
The warning adds to the misery afflicting the retail sector, with the high street reeling from soaring costs and the resultant collapse in consumer confidence.
Thousands of jobs have been lost as retailers such as Toys R Us and Maplin have collapsed and others have embarked on store closure programmes.
Dunelm boss Nick Wilkinson said: ‘We have seen an unexpectedly challenging start to the fourth quarter, with continuing softness in the homewares market and reduced footfall to our stores.
“We are making good progress on our strategic plans to be a truly multi-channel retailer and further strengthen our customer offer.
“We will learn from recent trading and I remain optimistic about our ability to deliver strong sales and profit growth in the future.”