Kingfisher impacted by weak performance in France
Kingfisher, the parent company of B&Q and Screwfix, has reported a drop in annual sales after a weak performance at its French arm.
In the year to 31 January, total sales fell by 1.5% to £12.78 billion while like-for-like sales declined by 1.7%.
Meanwhile, operating profit dropped by 29.7% to £407 million as pre-tax profit fell by 35.4% to £307 million.
Sales in France declined by 6.2% after Kingfisher’s Castorama and Brico Dépôt businesses were impacted by softer consumer confidence.
Never Miss a Retail Update!In contrast, sales in the UK and Ireland edged up 0.2% following an increase of 1% at Screwfix and a small drop of 0.4% at B&Q.
The group said it had seen encouraging big ticket sales trends in its fourth quarter, with kitchen sales growth in all markets.
Thierry Garnier, Kingfisher chief executive, said: “For the first time in over six years, we grew our market share in all key regions. We delivered profit and free cash flow in line with or ahead of our initial guidance, with strong delivery against our strategic objectives.
“Our ecommerce marketplaces are now live in the UK & Ireland, France, Poland and Iberia, and growing strongly with total GMV up 62%. Our trade sales penetration, excluding Screwfix, reached 17.9% in January, up 4.9%pts, with rapid progress being made in France and Poland.
“Our restructuring of Castorama France is progressing and we have accelerated our plans. As expected, the wider market backdrop was a headwind, though we maintained our laser focus on managing costs and cash, removing £120 million of structural costs and lowering same-store inventory by over £100 million.”
Kingfisher is planning to open up to 35 new Screwfix stores in its current financial year, including 30 Screwfix City stores.
Looking ahead, Garnier said: “The recent government budgets in the UK and France have raised costs for retailers and impacted consumer sentiment in the near term.
“With this in mind, we remain focused on what is in our control – progressing our strategic objectives at pace to deliver further market share gains, and continuing to manage gross margin, costs and cash effectively.
“Kingfisher is in its best operational shape for years, and we remain confident about the growth opportunities in our business.”
