Kingfisher Group LFL sales +6.1% in Q1

Kingfisher Group reports Q1 total sales up 6.1% (+6.1% LFL) and retail profit up 20.3% to £142 million for the 13 weeks ended 3rd May 2014. A special dividend of 4.2p per share as part of the continuing capital returns programme has also been announced.

Kingfisher UK & Ireland:

Total sales increased by 12.5% to £1,200 million (+10.1% LFL; +4.9% 2 year LFL) driven by a later Easter, much better weather compared to Q1 last year and some encouraging signs in both the underlying retail and smaller tradesman market.

Kingfisher UK & Ireland reported retail profit up 35.2% to £68 million. Gross margins were down around 200 basis points reflecting higher sales of lower margin outdoor seasonal and building products, the recognition of more promotionally-led showroom sales (kitchens, bathrooms and bedrooms) from Q4 last year and increased home delivery costs. Total UK & Ireland cash gross profit grew by 7% over the quarter. Tight cost control continued, despite higher levels of variable pay, together with some favourable cost phasing which will reverse later in the year.

B&Q UK & Ireland:

B&Q UK & Ireland’s total sales grew by 10.5% to £1,008 million (+9.7% LFL; +3.5% 2 year LFL). Sales of outdoor seasonal and building products, which can represent up to 30% of total Q1 sales, were up around 30% benefiting from the better weather and later Easter. Sales of indoor products were up around 3%. Tradepoint* continues to progress with sales up around 3% compared to last year.

Screwfix:

Screwfix grew total sales by 24.2% (+12.0% LFL) to £192 million, benefiting from a strong promotional programme, the continued roll out of new outlets and the continued success of the mobile ‘click, pay & collect’ offer. Nine net new outlets were opened during Q1, taking the total to 344.

Sir Ian Cheshire, Group Chief Executive, said:

“We have made a strong start to the year, capitalising on more favourable weather conditions right across Europe to achieve sales and profit growth in France, the UK & Poland, our three largest markets. Whilst this is encouraging, the first quarter is one of our smallest and the growth achieved largely reflects comparisons with the very difficult start to last year. We will annualise stronger figures in our second quarter and so, as ever, we will look at the whole of the first half results to properly assess our underlying performance.

“Our ‘Creating the Leader’ programme continues to progress well. We have also made a good start with our key corporate priorities this year having completed the sale of our stake in Hornbach, entered exclusive negotiations to acquire Mr Bricolage in France, opened our first store in Portugal and started to return surplus capital to shareholders. Furthermore, our self-help initiatives continue to underpin our results and as we enter the key summer trading period our focus remains on driving cash margin*, managing costs tightly and delivering shareholder returns.”

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Source : Kingfisher
www.kingfisher.com