B&M confident after first-quarter growth

16th Jul 2024 07:17

(Sharecast News) - Variety discount retailer B&M European Value Retail reported a 2.4% increase in group revenue for its first quarter on Tuesday.

The FTSE 100 company said the growth, driven by volume and a disciplined store opening programme, saw its total revenue reach £1.345 billion.

B&M UK generated £1.08bn in revenue, marking a 1.5% increase.

The company opened 19 new stores in the period ended 29 June, contributing to a strong performance, with plans to open a total of 45 new stores by the end of the financial year.

It said the newly-opened stores had exceeded performance expectations.

Despite a like-for-like sales decline of 3.5%, impacted by exceptional comparatives and unseasonal weather, B&M UK maintained a robust gross margin performance.

In France, B&M achieved a 7.5% rise in revenue, reaching £126m, and opened two new stores, with plans for a total of 11 new openings within the year.

Heron Foods also saw a revenue increase of 2.7%, amounting to £139m.

The group highlighted the successful sell-through of seasonal stock, particularly in gardening, and reported no markdown risk for the spring/summer period.

It said its product availability, range, and pricing remain strong, positioning the businesses well for the second quarter.

Logistics capacity across the UK and France continued to support the volume growth effectively, with the UK network strengthened over the past two years and additional capacity being added in France.

B&M remained optimistic about achieving profitable, cash-generating growth for the full financial year, supported by strong fundamentals and normalising comparatives.

"The growth fundamentals of our business are strong, with a highly disciplined approach on pricing, product and high operational standards," said chief executive officer Alex Russo.

"We continue to offer our customers exceptional value at a time when household incomes are under pressure."

Russo said that ahead of the second quarter, the company launched its 'Everyday Value' range with more than 500 new lines in core categories across home, electrical and pet in the UK and France.

"As we transition towards autumn/winter in the months ahead, our relentless focus on Everyday Low Price and Everyday Low Cost will ensure we continue to serve our customers well."

The group planned to release its half-year financial results for the 26 weeks ending 28 September on 14 November, and would provide full-year guidance at that time.

At 0844 BST, shares in B&M European Value Retail were up 1.84% at 454.8p.

Reporting by Josh White for Sharecast.com.