PARIS: Strong demand in Britain and Poland helped Kingfisher beat profit forecasts but Europe’s largest home improvement retailer said it remained cautious on the outlook for France, its most profitable market.
The firm, which runs the B&Q and Screwfix chains in Britain and Castorama and Brico Depot in France and other countries, reported underlying pre-tax profit of £436m in the six months to 31 July, up 13.5%. That compared with analysts’ average forecast of £430m and £384m in the previous year. Total sales rose 2.7% to £5.75bn on a constant currency basis.
Kingfisher’s share price was up nearly 2% after the results announcement. “Performance has been driven by Poland and the UK, especially Screwfix, and a stable profit performance in France,” said the chief executive, Véronique Laury. Kingfisher also benefited from £17m of favourable currency movements on the translation of non-sterling retail profits.
“In the UK, the EU referendum has created uncertainty for the economic outlook, even though there has been no clear evidence of an impact on demand so far on our businesses. In France we remain cautious on the short-term outlook,” Laury said.
In January, Laury announced a strategy to boost Kingfisher’s annual profit by £500m from 2021 that would cost £800m over five years to deliver. The plan involves unifying the product offer across the business, improving its e-commerce capabilities and driving efficiencies. Laury said the programme was on track.The firm also plans to return £600m to shareholders over the next three years through share buybacks. It has so far returned £160m.
Before Tuesday’s update most analysts expected a full-year underlying pre-tax profit of £773m, up from £686m in 2015-16.
