Home improvement retail group Kingfisher has posted a drop in annual sales after a weak performance from business in France and subdued demand in the UK.
Over the year to 31 January, the company’s total sales slipped 1.5% to £12.78bn, with like-for-like sales down 1.7%.
Like-for-like sales in France fell by 6.2% after trade in its Castorama and Brico Dépôt chains was impacted by weak consumer confidence.
Sales in the UK and Ireland edged up 0.2% after an increase of 1% at Screwfix offset a drop of 0.4% at B&Q. The group noted that it had seen encouraging big ticket sales trends in its fourth quarter, supported by new kitchen and bathroom ranges.
Meanwhile, retail profit fell 6.6% in constant currency to £696m, reflecting lower profits in France and higher losses from its joint venture in Turkey. Adjusted pre-tax profit was down 7.0% to £528m.
Despite the weak figures, Kingfisher’s Chief Executive, Thierry Garnier, remained upbeat. He 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 e-commerce 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 £120m of structural costs and lowering same-store inventory by over £100m.”
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.”
