Kingfisher makes solid start as French sales decline eases

(Sharecast News) - DIY retailer Kingfisher reported a small increase in underlying revenues in its first quarter as the sales declines at its French operations eased while growth picked up strongly in the UK and Ireland. Group sales totalled £3.31bn over the three months to 30 April, up 2.2% over last year at constant currencies, with like-for-like sales rising 1.8%. Excluding differences from calendar adjustments, such as an extra day of trading last year and the impact of national public holidays falling on different days of the week, LFL sales would have been up 2.7%.

In the UK and Ireland, where Kingfisher operates B&Q and Screwfix, revenues rose 6.1% to £1.73bn with LFL sales up 5.9%. That's up from 1.3% and -0.1% growth for the divisions in the fourth quarter, respectively.

At B&Q, the company reported strong seasonal category sales and a positive performance in core and 'big-ticket' categories, along with trade sales, while Screwfix sales were helped by an increased product range for trade customers and growth of its click and collect and rapid delivery offerings.

In France, sales dropped 4.9% to £976m, with LFL sales at both its Castorama and Brico Dépôt chains falling 3.9% and 3.3% respectively. However, the company noted improving underlying trends across both businesses, with LFL sales having dropped 6.0% and 5.4% in the fourth quarter respectively.

In Poland, sales were down 0.4% at £443m, with LFL sales falling 3.2%, which the company blamed on short-term volatility due to geopolitical factors. Meanwhile, in other international operations, sales were up 2.5% at £164m with LFL sales rising 5.3%.

Chief executive Thierry Garnier said Kingfisher "made a good start to the year with [...] market share gains in all key regions and further progress in our strategic priorities.

"It is still early in the year and consumer sentiment remains mixed across our markets. We are focused on executing our strategic growth priorities, maintaining discipline on margin and costs, and driving shareholder returns. We are confident in delivering our full year guidance."

The company reiterated its full-year guidance for adjusted pre-tax profit of £480m-540m and free cash flow of £420m-480m. That compares with last year's results of £528m and £511m, respectively.