Essential reading for retailers and suppliers in the home improvement market

B&Q doubles UK profit

Published: 2 June 2009
DIY chain's UK profits jump to £58m in Q1 thanks to warm weather and late Easter.
B&Q doubles UK profit
B&Q's retail profit doubled to £58m in the 13 weeks to May 2, 2009, compared with £29m in 2008/2009, parent company Kingfisher's Q1 trading statement revealed.

The DIY chain's total sales grew 4.6% to £1,043m, while warm weather boosted sales of outdoor products, which were up more than 30%.

B&Q saw a 148% increase in sales of charcoal barbecues in the 13-week period, while sales of metal garden furniture and wooden garden furniture were up 107% and 28% respectively. Sales of outdoor wooden decking also jumped 63%, with greenhouse and shed sales experiencing a 14% increase.

Sales of core DIY and decorative products remained "relatively resilient", down just 2%, supported by, B&Q said, "increasing consumer interest in DIY and room makeovers". The company saw a 22% increase in sales of tool storage in Q1.

B&Q is continuing its store revamps, although on a "lower-cost" basis, making savings with faster completions – minimising trading disruption – and by recycling existing features.

Looking at Kingfisher's other UK operations, Screwfix revealed a total sales decline of 6% to £119m. It continued its roll out of trade counters, opening seven new outlets in Q1.

Kingfisher's total UK sales grew by 2.9% to £1,163m - up 0.9% on a like-for-like basis. UK retail profit for the group grew by almost 90% to £61m, compared with the same period last year.

The group's total sales were up 2.4%, further boosted by a 1.7% increase in sales and 3.5% profit jump at its French operations. Kingfisher's Eastern Europe business continued to grow, with sales in Poland up 9.3% to £221m for the first quarter and retail profit up 4.6% to £25m.

B&Q China saw its sales drop 23.7% for the quarter ended March 31, 2009. Losses increased by 25.7% to £14m, reflecting the sharp sales decline as well as around £3m of "planned additional losses from running down stores ahead of a store portfolio rationalisation in May," the trading statement explained.

Unsurprisingly, share prices in the home improvement group have been gaining today, rising 7% to 196.7p in early trading - their highest level since September 2007.

Kingfisher group chief executive Ian Cheshire said: "We have made a good star to the year, boosted by better weather and a later Easter. B&Q in particular capitalised well on this increased demand, growing its market share and doubling its retail profit. Whilst there is still work to be done, I am confident that B&Q is emerging from its renewal phase in better shape to convert sales volumes into cash profits."

He added: "Looking ahead, we are unlikely to see a weather driven seasonal bounce in demand again in 2009 and we continue to plan for a particularly tough balance of the year in our major markets."

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