This coming week - Kingfisher Update

B&Q performance will be in focus this coming week, when parent company Kingfisher delivers an update.

B&Q owner Kingfisher is expected to report a drop in like-for-like sales for the chain when it posts a first quarter update on Thursday though analysts expect the performance of stablemate Screwfix should mean a solid performance for the overall group.

Brokers at Jefferies think B&Q will post a decline of 2% compared to a year ago, reflecting later Easter trading and waning popularity for DIY.

But Kingfisher's chain Screwfix, aimed at the trade, is expected to register same store sales up 10% as the housing market remained buoyant despite the build-up to the May general election.

In March Kingfisher said it would close as many as 60 B&Q stores over the next two years in a shake-up set to impact on up to 3,000 jobs in the UK and Ireland.

Kingfisher wants to cut about 15% of surplus space through the review of the 360-strong B&Q estate as Britons become less keen on DIY.

Staff at Southampton, Dundee, Baums Lane in Mansfield, Stetchford Road in Birmingham, Hyde in Greater Manchester and Barnsley have been told their stores are closing, but the locations of the other shops have not been disclosed.

Last year, rival DIY chain Homebase said it would close a quarter of its stores - about 80 outlets - in the period up to early 2018.

The changes at Kingfisher were announced as the company posted a 7.5% drop in annual profits to £675 million after sales fell by 1.4% to £11 billion in the year to January 31.

The performance was impacted by trading in France, where Castorama and Brico Depot were hit by the weak economy and low consumer confidence.

Chief executive Veronique Laury, who took over from Sir Ian Cheshire in December, said the UK and Ireland closure plan was one of a number of ''sharp'' decisions being taken by the FTSE 100 company.

Other plans include cutting back on some of the 393,000 products sold across the company, particularly as only 7,000 items - amounting to 7% of sales - are sold in at least two of Kingfisher's operating companies.

The company will also look to optimise vacant store space and is in discussions with several retailers about sub-letting opportunities.

Kingfisher has already agreed to sell a controlling stake in its loss-making China business as it looks to focus on its core European market.

There has even been speculation that the group might plan to phase out the B&Q brand name.

Source: Express & Star.

Read the full news article here.