Next and B&Q eye expansion after surprise surge in profits

Both chains also raise dividends for shareholders

Two of the UK's biggest retailers posted a surge in 2009 profits yesterday, but both warned of a tough and uncertain consumer environment ahead.

Next, the fashion and homewares retailer, posted an 18 per cent rise in pre-tax profits to £505m for the year to January 2010 and signalled an acceleration in the rollout of its standalone Next Home stores.

Meanwhile, the global DIY retail group Kingfisher, which owns B&Q, crafted a 48.6 per cent jump in adjusted profits to £547m and the first growth in its dividend for five years.

Next and Kingfisher gained from better-than-expected trading conditions in the retail sector last year, but both also boosted their bottom line by keeping a tight control on costs and stock, and improving the product offer.

Simon Wolfson, the chief executive of Next, which upgraded its profit forecasts by a record five times over the year, said: "Things have turned out very differently to how we expected at the start of the year." Group sales at Next jumped by 10.8 per cent to £3.41bn over the year. The retailer, which has 517 stores, proposed a final dividend of 47p, lifting the growth in its annual payment by 20 per cent.

Mr Wolfson also said that of the 20 new stores Next will open this financial year, 12 will be standalone home stores on retail parks. He said: "The home stores have performed 43 per cent ahead of expectations. We have now reached a critical mass and people now see us as a one-stop destination where they can get products, such as sofas and cutlery."

Over the 53 weeks, retail sales at Next rose by 3.5 per cent to £2.27bn.

Mr Wolfson said he thought it was "unlikely" there would be a double-dip recession in the UK, but warned: "The consumer environment is going to be tough for sometime until the [public sector] deficit is sorted out."

In the DIY sector, Kingfisher, which has operations in countries including Poland, France and China, delivered a 4.8 per cent uplift in total sales to £10.5bn for the year to 30 January 2010. The UK's biggest DIY chain B&Q, with 330 stores, posted a 79.4 per cent uplift in retail profits to £195m.

Ian Cheshire, the group chief executive of Kingfisher, said it would roll out its Trade Point business – a dedicated area in stores serving bonafide trade customers – to 118 stores by the late summer.

Targeting the £20bn UK trade market, Trade Point will provide an in-store catalogue offering 8,000 items held in a warehouse behind the counter.

Kingfisher also plans to pilot eight new shop-in-shops, including areas for storage products, home cleaning, garage workshops and eco-friendly items.

But Mr Cheshire said Kingfisher plans for a "difficult market" this year.

Suggested Topics
Start your day with The Independent, sign up for daily news emails
ebooks
ebooksAn introduction to the ground rules of British democracy
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
SPONSORED FEATURES
Independent Dating
and  

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

iJobs Job Widget
iJobs Money & Business

Recruitment Genius: Content Writer - Global Financial Services

£25000 - £30000 per annum: Recruitment Genius: From modest beginnings the comp...

Recruitment Genius: Web Developer - PHP

£35000 - £40000 per annum: Recruitment Genius: From modest beginnings the comp...

Recruitment Genius: Field Sales Consultant - Financial Services - OTE £65,000

£15000 - £65000 per annum: Recruitment Genius: This is an exciting opportunity...

Recruitment Genius: Loan Underwriter

£18000 - £20000 per annum: Recruitment Genius: This is a fantastic opportunity...

Day In a Page

A nap a day could save your life - and here's why

A nap a day could save your life

A midday nap is 'associated with reduced blood pressure'
If men are so obsessed by sex, why do they clam up when confronted with the grisly realities?

If men are so obsessed by sex...

...why do they clam up when confronted with the grisly realities?
The comedy titans of Avalon on their attempt to save BBC3

Jon Thoday and Richard Allen-Turner

The comedy titans of Avalon on their attempt to save BBC3
The bathing machine is back... but with a difference

Rolling in the deep

The bathing machine is back but with a difference
Part-privatised tests, new age limits, driverless cars: Tories plot motoring revolution

Conservatives plot a motoring revolution

Draft report reveals biggest reform to regulations since driving test introduced in 1935
The Silk Roads that trace civilisation: Long before the West rose to power, Asian pathways were connecting peoples and places

The Silk Roads that trace civilisation

Long before the West rose to power, Asian pathways were connecting peoples and places
House of Lords: Outcry as donors, fixers and MPs caught up in expenses scandal are ennobled

The honours that shame Britain

Outcry as donors, fixers and MPs caught up in expenses scandal are ennobled
When it comes to street harassment, we need to talk about race

'When it comes to street harassment, we need to talk about race'

Why are black men living the stereotypes and why are we letting them get away with it?
International Tap Festival: Forget Fred Astaire and Ginger Rogers - this dancing is improvised, spontaneous and rhythmic

International Tap Festival comes to the UK

Forget Fred Astaire and Ginger Rogers - this dancing is improvised, spontaneous and rhythmic
War with Isis: Is Turkey's buffer zone in Syria a matter of self-defence – or just anti-Kurd?

Turkey's buffer zone in Syria: self-defence – or just anti-Kurd?

Ankara accused of exacerbating racial division by allowing Turkmen minority to cross the border
Doris Lessing: Acclaimed novelist was kept under MI5 observation for 18 years, newly released papers show

'A subversive brothel keeper and Communist'

Acclaimed novelist Doris Lessing was kept under MI5 observation for 18 years, newly released papers show
Big Blue Live: BBC's Springwatch offshoot swaps back gardens for California's Monterey Bay

BBC heads to the Californian coast

The Big Blue Live crew is preparing for the first of three episodes on Sunday night, filming from boats, planes and an aquarium studio
Austin Bidwell: The Victorian fraudster who shook the Bank of England with the most daring forgery the world had known

Victorian fraudster who shook the Bank of England

Conman Austin Bidwell. was a heartless cad who carried out the most daring forgery the world had known
Car hacking scandal: Security designed to stop thieves hot-wiring almost every modern motor has been cracked

Car hacking scandal

Security designed to stop thieves hot-wiring almost every modern motor has been cracked
10 best placemats

Take your seat: 10 best placemats

Protect your table and dine in style with a bold new accessory