Kingfisher's UK DIY Sales Rise While French and Polish Markets Decline
FTSE 100 DIY retailer Kingfisher has reported a mixed performance, with UK operations B&Q and Screwfix showing growth while its French and Polish divisions face significant declines. The company, which owns popular home improvement brands, saw sales climb by over three per cent in the UK, but experienced falling revenues in France and Poland, undermining overall results.
Sales Performance Across Regions
In the UK, B&Q and Somerset-based Screwfix delivered robust sales growth, driven by an emphasis on e-commerce, powerful seasonal sales periods, and strategic acquisitions. B&Q's purchase of several Homebase stores contributed to this uplift, with the brand opening 10 new outlets, eight of which were transformed from former Homebase properties, while closing three. Screwfix expanded its physical presence with 32 new sites and five closures, resulting in 41 net openings across Kingfisher's international brands.
Conversely, the French Castorama division saw sales decline by 2.2 per cent, with Brico Depot dropping 2.3 per cent, and Poland experienced a 1.1 per cent dip. Analysts note that Castorama has been among Kingfisher's most persistently underperforming operations, grappling with stagnant sales and declining demand for major purchases like kitchen renovations, which fell 4.5 per cent year on year.
Financial Highlights and Strategic Moves
Kingfisher recorded an adjusted pre-tax profit of £560 million, up six per cent from the previous year and in line with analysts' expectations. However, total sales across all operations edged up by only 0.2 per cent, reflecting the challenges abroad. The company has focused on reducing costs, shedding £120 million in excess expenditure last year, and unveiled a new £300 million share buyback programme, having repurchased £1.2 billion in shares since 2021.
The share price rose by two per cent during early trading to 302p, leaving the stock up eight per cent over the past year but down more than 10 per cent since the pandemic-era DIY surge. This indicates ongoing volatility in the retail sector.
Focus on Trade Customers and Market Trends
Kingfisher aims to drive future growth by concentrating on sales to tradespeople, who shop more regularly and spend more than typical customers. The company has established dedicated trade zones in each outlet, recording growth in trade sales of five per cent at B&Q, four per cent at Screwfix, and as much as 47 per cent in Castorama Poland.
B&Q and Screwfix are anticipating the annual spring DIY surge, with rivals suggesting that the UK's ageing housing stock maintains elevated demand for home improvement. However, like competitor Wickes, Kingfisher has struggled to shift big-ticket purchases as Britons reduce discretionary spending amid economic pressures.
Overall, Kingfisher's performance highlights a resilient UK market contrasted with ongoing difficulties in Europe, shaping its strategic focus on cost efficiency and trade-oriented growth.
