B&M Goes From Strength To Strength In First Half

B&M Retail's latest interim results for the 26 weeks ended 26th September have shown that group revenues reached £2,242.1m, an increase of 25.3%. 

B&M's UK stores achieved growth of 23%, with a 26.9% rise during Q1 and a 19.1% rise in Q2. Adjusted EBITDA growth was up by 100.0% to £274.7m.

At the start of the coronavirus crisis, the UK government classified B&M as an essential retailer due to its c.£2bn in annual grocery sales and 4 million weekly shoppers. 

During the first lockdown, B&M increased the pay of front line workers, donated £1m in cash to foodbanks and gave NHS staff discounts which amounted to £2.9m. The £3.7m received by the retailer under the UK Government’s CJRS scheme has been paid back.

Data from Barclaycard indicates that in June 2020, 23% of B&M's customers had not shopped there in the previous five months, providing the retailer with an opportunity to retain the loyalty of new shoppers.

B&M noted a shift in its sales mix towards non-grocery, due to the popularity of its homewares, DIY and gardening ranges, and said that the high sell-through rate on these seasonal goods meant that markdown activity was limited.     

Over the period, B&M opened 9 new stores and closed eight - a net increase of one - and created 1,800 jobs.

B&M expects like-for-like sales growth to moderate during the second half of the financial year, but so far, growth has been at a similar level to the first half.  Its new store pipeline has improved, but openings for both the B&M and Heron Foods businesses will be signifcantly back-end weighted in both Q3 and Q4, assuming Q4 openings are not durther delayed by construction restrictions.

With its convenient out-of town locations and broad range of essential goods, B&M belives that it is relatively insulated from the broader challenges over the Golden Quarter trading period.

See the full results publication here.

Source : Insight DIY Team

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