B&Q owner Kingfisher gets autumn sales boost

 

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The Independent Online

The unseasonal autumn weather and the closure of rival Focus DIY helped ease the sales pressure at B&Q owner Kingfisher today.

The retailer, which operates 536 B&Q and Screwfix stores in the UK and Ireland, said like-for-like sales were down 0.7% in the 13 weeks to October 29, an improvement on the 1.3% decline in the previous quarter.

B&Q's profits were up 20% at £46 million as trading benefited from the closure of Focus DIY and the subsequent conversion of 27 of its stores to the B&Q format.

The autumn weather also boosted sales of garden furniture, helping it sell more barbecues in the last week of September than in the whole month of June.

Meanwhile, more than 2,000 of Kingfisher's employees were today celebrating a £7.4 million windfall after two of its share incentive schemes matured, leading to an average gain of £3,516 per person.

Kingfisher said beneficiaries included 22-year-old Danielle Macey, who works in B&Q's Nursling store in Southampton as a part time checkout assistant. She saved the maximum £250 a month in the three year scheme and will receive a payout of £22,511, a gain of £12,911.

Chief executive Ian Cheshire said: "Retailing is a people business and it is the hard work of our staff that has delivered this performance. I am delighted that they are sharing in the benefits."

Like-for-like sales at B&Q were down 0.9% despite a 68% rise in garden furniture sales, which were boosted by the weather. But at the same time, B&Q saw a 78% increase in demand for winter grit and snow shovels as households prepare for the possibility of another Arctic onslaught.

Non-seasonal sales were down 4%, reflecting the "generally weak consumer backdrop".

Its 179 Screwfix stores saw total sales increase 7% as the opening of four outlets and new ranges such as safety and workwear helped it offset a "challenging" market for its customer base of self-employed traders. The chain's profits rose 27% to £10 million.

A further 35 Screwfix stores will open by the end of January as part of a drive to expand its trade supply arm and create 1,200 new jobs.

The group's overseas stores put in a stronger sales performance. In France, where the group operates Castorama and Brico Depot, like-for-like sales rose 1.9% and profits lifted 18.8%, while losses in China were reduced. Total group profits rose 13.9% to £273 million, on sales up 4.6% to £2.8 billion.

Shares were up 5% after Mr Cheshire said the group was in "good shape" to continue to gain market share and grow profits, despite challenging conditions.

Kate Calvert, an analyst at Seymour Pierce stockbrokers, said profits were higher than her expectations of £264 million.

She said the group will continue to benefit from direct sourcing and producing more own-label products. This will help it deal with the squeeze in consumer spending and falling house prices, which will have knock-on effect on the DIY market.

PA

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