B&Q and Screwfix owner Kingfisher cuts profit forecast
- DIY retailer lowers profit guidance from £634million to £590million
- Statutory pre-tax profit was down by 33% to £317million in H1
- Figure falls short of the expected £356million
B&Q owner Kingfisher has lowered its profit forecast for the year, citing low consumer confidence.
Kingfisher, which also owns Screwfix, has lowered its profit guidance for the year from £634million to £590million.
The London-based DIY retailer said that statutory pre-tax profit was down by 33 per cent to £317million for the six months ending 31 July, falling short of the expected £356million.
The London-based company said that statutory pre-tax profit was down by 33 per cent to £317million for the six months ending 31 July
Kingfisher group said that this reflected lower operating profit, which fell more than per cent to £367m in the period.
Although like-for-like sales in the UK and Ireland were up 1.7 per cent, its Polish and French arms saw drops of 10.9 per cent and 3.8 per cent respectively.
The FTSE 100 business also said that overall, like-for-like sales were ‘slightly ahead of expectations’ despite being down by 2.2 per cent for the first half of the year.
In the UK and Ireland, the firm saw an increase in operating costs caused due to higher pay and energy rates, and the impact of the weather saw seasonal sales down by 5.9 per cent.
Kingfisher shares were down by 5.98 per cent to 221.50p in morning trading on Tuesday.
Thierry Garnier, chief executive officer, of Kingfisher said: ‘Our like-for-like sales in H1 were slightly ahead of expectations, against a backdrop of unseasonal weather and ongoing macroeconomic challenges in our markets. We saw good growth in our UK banners, with Screwfix gaining significant market share.
‘At the same time, we faced strong comparatives and a weaker trading environment in Poland, while consumer confidence in France is at a 10-year low.
‘Overall, demand for our core and “big-ticket” categories was healthy, and we were pleased to see an improving volume trend in these categories through the half.’
In May, the group blamed bad weather for hitting purchases of seasonal products during the first quarter of the financial year.
The firm reported an 11.3 per cent fall in like-for-like revenues from seasonal categories for the three months ending April, as well as a 1.2 per cent drop in sales of ‘big-ticket’ and core items.
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