Kingfisher grows, but Screwfix and B&Q record softer sales in Q4

Sales rose 3.8% for Kingfisher – owner of B&Q, Screwfix, Brico Dépôt & Castorama – in its 2017/2018 financial year. Sales hit £11,655 million, up from £11,225m.

Screwfix

Screwfix performed well over the course of the year, although sales softened in Q4 for the reliable brand. Over the year, sales increased 16.7% (10.1% l-f-l) driven by strong growth from the specialist trade desks exclusive to plumbers and electricians, strong digital growth (mobile up a staggering 86% and click and collect up 38%). 60 net new outlets were opened, hitting the total of 577. Kingfisher said it aims to have 700 Screwfix outlets in the UK.

B&Q

B&Q saw a sales decline of 5.3% to £3,488 million, with the now completed store closure programme hitting the results. L-f-l sales declined 2.8% after a 0.7% benefit from the store closures. Click and collect is now more widely available on B&Q products (33,000) and total digital sales grew 11%, now representing 4% of total sales. Kingfisher said the outlook in the UK was “more uncertain”.

Castorama & Brico Dépôt

Castorama total sales fell 1.9% (-2.4% l-f-l) to £2,406 million. Brico Dépôt total sales fell 4.2% (-4.8% l-f-l) to £1,981 million. Across the two businesses, two new net stores opened and one was revamped. Kingfisher said it is encouraged by the market backdrop in France, “although it is volatile”.

Poland & ROW

Sales in Poland grew 6.3% (5.3% l-f-l) to £1,384 million in a “supportive” market. Russia sales fell 3.7% to £391 million, reflecting a “challenging environment”. Spain sales fell 4.8% to £316 million. New country developments (Romania, Portugal and Germany) saw sales of £174 million with a retail loss of £17 million (2016/17: £16 million reported retail loss). Romania delivered a £3 million retail profit (2016/17: break even reported result) and Screwfix Germany made an £18 million retail loss (2016/17: £14 million reported retail loss) largely reflecting the annualisation of stores opened in the previous year. Further roll out of Screwfix Germany is on hold this year pending completion of the unified IT platform roll out.

Progress on Kingfisher ONE, despite mixed performance

“We have made good progress in this second year of our ambitious five-year transformation after a significant step up in the level of activity,” said Kingfisher CEO Véronique Laury. “For the second year in a row, all our key strategic milestones have been met and I am really pleased to say that we are starting to see tangible delivery of our plan… We are buying as ONE and are starting to see the customer and financial benefits coming through, both in sales and gross margins. Our digital initiatives are gaining momentum as we enter the final year of roll out of our unified IT platform…

“Our performance this year has been mixed, however, with solid growth at Screwfix and Poland, offset by continued weaker sales in France and some business disruption, principally reflecting product availability and clearance. We are acting on the causes of this disruption, however next year will be another big year in our transformation plan. The pace of change is quick and impactful but necessary as we build the new ONE Kingfisher engine to support our ambition to be the leading home improvement company, based on putting customer needs first. The outlook for our main markets is also mixed. The UK is more uncertain, France is encouraging yet volatile, whilst the market in Poland remains supportive.

“Given our good progress so far, and supported by our highly engaged teams, I remain confident in our ability to deliver our plan and in the customer and financial benefits it will generate.”

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