Kingfisher's LFL sales hit by France weakness

21st May 2024 07:14

(Sharecast News) - Home improvement retailer Kingfisher has said that first-quarter like-for-like sales were down on last year on the back of weakness in France, with the decline picking up pace early into the second quarter.

Kingfisher said it was cautious over the market outlook for 2024 due to the lag between housing demand and home improvement demand; it still forecasts negative to flat growth in total addressable markets across its key regions.

The company, which owns B&Q, TradePoint and Screwfix in the UK, along with European chains Castorama, Brico Dépôt and Koçtaş, reported total sales of £3.26bn for the three months to 30 April, down 0.3% on a reported basis but up 0.3% at constant currencies.

On a like-for-like (LFL) basis, sales were down 0.9%, with growth in the UK and Ireland, Poland, Iberia and Romania offset by a 5.3% drop in France, which it said was "broadly in line with [a] weaker market".

While that was an improvement on the 4.3% group LFL sales decline reported in the fourth quarter, LFL sales have fallen by a further 2.5% in the first three weeks of the second quarter ended 18 May.

"We have seen continued resilience in our core categories, although 'big-ticket' sales have been weak reflecting the broader market as expected," said chief executive Thierry Garnier.

"We remain focused on driving productivity gains and maintaining tight control of our costs and inventories. In France we are pushing ahead with our plan to improve performance, having successfully completed our structural simplification and transitioned to new leadership at Castorama."

Kingfisher said it continues to expect adjusted pre-tax profit to come in at £490m to £550m for the fiscal year ending 31 January 2025, down from £568m reported the year before.