Kingfisher share price tumbles on weaker Q4

Kingfisher’s share price tumbled on Wednesday and then again on Thursday after their full year update, losing over 11% of the company's value to close at 292.70p, and weighing heavily on the FTSE 100 index which ended the session 0.32% lower at 7,038.97 points. Over the last 12 months Kingfisher shares have given up nearly 13% of their value, as compared with a 4.6% decline in the FTSE 100.

With a number of the UK's large bricks and mortar retailers currently in intensive care and with the weak and worsening performance at Homebase, investors took a fright when Veronique explained that the outlook for the year ahead for Kingfisher's main markets looks mixed. "The UK is more uncertain, France is encouraging yet volatile" she told investors in a call following the release of the results.

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There was a particular focus on Q4, where Kingfisher announced that their businesses experienced softer sales patterns, with B&Q -5.1% LFL and Screwfix +7.1% LFL, reflecting softer demand for big ticket categories such as kitchens. The slowing performance at Screwfix caused concern as this had been relied on previously as the star in their portfolio of retail businesses, which also includes Castorama and Brico Depot in France.

Read - B&Q sales decline 5.3% as UK outlook remains uncertain.

The results provide further evidence that UK consumers are cutting back on big-ticket home spend, also evidenced by the turmoil being experienced at Carpetright.

Source: Steve Collinge, MD Insight Retail Group Ltd.

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