Mulcahy digs in at Woolworths

Sir Geoff Mulcahy, chief executive of the Kingfisher retail chain, has ruled out selling any of the group's ailing Woolworths shops as part of his strategy to restore the group's fortunes.

Sir Geoff has been under pressure to offer some radical suggestions for both Woolworths and Comet after Kingfisher announced its first profits decline in its 13-year history in January. Comet reported a pounds 2m loss while profits at Woolworths fell by a third to pounds 51m.

Sir Geoff said: "We have sold stores before to people like Marks & Spencer, BhS and Burton, but selling chunks of stores would affect the economics of the group." He added that only half a dozen branches of Woolworths were loss-making.

Analysts do not see the economic benefit of retaining loss makers when supermarket groups such as Tesco have expressed interest in acquiring high street sites.

Sir Geoff has spent the last week talking to City analysts and institutional investors about his new strategy for Woolworths. The "seminars" are part of Kingfisher's new approach to investor relations intended to communicate more fully with the investment community. Seminars on Superdrug and the electricals businesses, Comet and Darty, are planned later this year.

However, many retail analysts declared themselves underwhelmed by Sir Geoff's plans to put the wonder back into Woolies. Hilary Monk of Verdict Research said: "There was nothing desperately new." Emma Burdett of Hoare Govett said the plans were logical but added that management had really only "bought themselves some time."

The grand plan for Woolworths is:

rTo return Wolworths to a value-for-money format after last year's mistakes when prices became uncompetitive.

rTo target young mothers on a budget as its core customers.

rTo segment the chain into three types depending on location and adapt the product ranges accordingly. The three groups are heartland stores in market towns where Woolworths is the largest shop; local shops in suburban areas; and city centres where the shops are against competition from rivals like Marks & Spencer and BhS.

rTo concentrate product ranges on the home and family.

Sir Geoff, who was demoted from chairman to chief executive as part of wholesale board and management changes earlier this year, defended the strategy.

"The real issues last year were operational rather than strategic. Woolworths lost its price competitiveness and suffered from stock availability problems," he said.

He added that progress in the first quarter, which showed that sales were ahead, proved that the strategy was on the right lines.

Investment Column, page 18

Start your day with The Independent, sign up for daily news emails
ebooksAn unforgettable anthology of contemporary reportage
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Recruitment Genius: Payments Operations Assistant

£23000 - £25000 per annum: Recruitment Genius: They win lots of awards for the...

Recruitment Genius: Telephone Debt Negotiator

£13500 - £20000 per annum: Recruitment Genius: This nationwide enforcement com...

Guru Careers: Communications Exec / PR Exec

£25 - £30K: Guru Careers: We are seeking a highly-motivated and ambitious Comm...

Guru Careers: Pricing Analyst

£30 - 35k: Guru Careers: We are seeking a Pricing Analyst to join a leading e-...

Day In a Page

On your feet! Spending at least two hours a day standing reduces the risk of heart attacks, cancer and diabetes, according to new research

On your feet!

Spending half the day standing 'reduces risk of heart attacks and cancer'
Liverpool close in on Milner signing

Liverpool close in on Milner signing

Reds baulk at Christian Benteke £32.5m release clause
With scores of surgeries closing, what hope is there for the David Cameron's promise of 5,000 more GPs and a 24/7 NHS?

The big NHS question

Why are there so few new GPs when so many want to study medicine?
Big knickers are back: Thongs ain't what they used to be

Thongs ain't what they used to be

Big knickers are back
Thurston Moore interview

Thurston Moore interview

On living in London, Sonic Youth and musical memoirs
In full bloom

In full bloom

Floral print womenswear
From leading man to Elephant Man, Bradley Cooper is terrific

From leading man to Elephant Man

Bradley Cooper is terrific
In this the person to restore our trust in the banks?

In this the person to restore our trust in the banks?

Dame Colette Bowe - interview
When do the creative juices dry up?

When do the creative juices dry up?

David Lodge thinks he knows
The 'Cher moment' happening across fashion just now

Fashion's Cher moment

Ageing beauty will always be more classy than all that booty
Thousands of teenage girls enduring debilitating illnesses after routine school cancer vaccination

Health fears over school cancer jab

Shock new Freedom of Information figures show how thousands of girls have suffered serious symptoms after routine HPV injection
Fifa President Sepp Blatter warns his opponents: 'I forgive everyone, but I don't forget'

'I forgive everyone, but I don't forget'

Fifa president Sepp Blatter issues defiant warning to opponents
Extreme summer temperatures will soon cause deaths of up to 1,700 more Britons a year, says government report

Weather warning

Extreme summer temperatures will soon cause deaths of up to 1,700 more Britons a year, says government report
LSD: Speaking to volunteer users of the drug as trials get underway to see if it cures depression and addiction

High hopes for LSD

Meet the volunteer users helping to see if it cures depression and addiction
German soldier who died fighting for UK in Battle of Waterloo should be removed from museum display and given dignified funeral, say historians

Saving Private Brandt

A Belgian museum's display of the skeleton of a soldier killed at Waterloo prompts calls for him to be given a dignified funeral