Chilly weather blew an ill wind through sales figures produced by Kingfisher, the multinational DIY retailer best known for B&Q here and Castorama across the Channel.
At stores open at least a year sales in the UK and Ireland fell by 5.8 per cent for the three months to the end of January. In France the decline was more muted, but a 2.4 per cent fall still doesn't make for happy reading.
The international operations in Poland, Spain, China and Russia were a mixed bag, but overall produced a 0.3 per cent increase, which is no better than OK.
However, the company should still hit earnings forecasts of about £715m for the year pre-tax. Lower bonuses for staff (I'd argue that executives should also take the hit) and a lower ad spend have helped to keep the numbers healthy, according to analysts. And Kingfisher's performance was by no means the worst in the sector. It's the market leader and has actually gained market share.
What's more, some parts of the business are doing rather well. One plus was the growth in the smaller Screwfix business, which is expanding rapidly both in terms of stores and online. It chiefly serves the needs of trade buyers (something Kingfisher seems to be good at).
The problem for me is this: analysts highlighted a survey showing that Britons don't really enjoy DIY and are more than happy to put off doing work when finances get tight. Finances are very tight at the moment.
It might help Kingfisher if its B&Q stores were more welcoming environments and staff showed an interest in helping customers with, say, DIY queries. My personal experience of them has been extremely negative. Note to executives: give your consumers a little love and they tend to pay you back with their business.
That said, the real attraction of Kingfisher is, in addition to ScrewFix, those businesses in China, Russia, and a joint venture in Turkey. These are places with emergent middle classes who have money to spend on their homes. This is something that Kingfisher appears well-positioned to capitalise on.
For the year ending 31 January 2014 the shares trade on 11.5 times forecast earnings, while offering a prospective yield of 3.7 per cent. By historic standards they are by no means expensive.
This column has been a supporter of the stock for a number of years and the shares have been reliable performers over that time, even if its editor is no longer a supporter of the shops.
While the outlook is cloudy for the UK, and there is arguably an over-supply of DIY outlets, the overseas outlook is somewhat better. I'd be willing to take a risk on Kingfisher and buy.
Another consumer company that's been making waves, and not always in a good way, is Premier Foods, whose enviable portfolio of brands includes Hovis and Mr Kipling.
Premier Foods' big problem has been its debt, and that's resulted in a number of disposals. The problem with selling businesses to pay down debt is you often have to do it on the cheap because buyers will be well aware of your distress.
Step forward Gavin Darby, the former Cable & Wireless Worldwide boss, who is promising better tidings and has put his money where his mouth is by snapping up 750,268 shares at 93.3p.
Commendable – although the City didn't think much of it, and after a day he was facing the thick end of £50,000 in losses. Ouch.
Sales of businesses have netted more than £400m, reducing the company's debt to just under £1bn.
Sales to consumers from what remains fell 12.2 per cent to £17.6bn, although the company was keen to point out that they rose 3 per cent at "underlying businesses" excluding milling, businesses in the process of being sold and other bits and pieces. It's basically a number that makes the company look good.
Still, I do wonder if brands like Hovis, and Mr Kipling, which are trusted and don't involve meat, might not be worthy of a little investment.
The shares are at a low ebb, and coming from Cables Mr Darby ought to know a thing or two about dealing with debt.
As he has committed his own funds, I'd be inclined to follow his lead, particularly now the shares are even lower than the level at which he bought in. Speculative buy.Reuse content