Posted 20th March

Kingfisher sees profits drop by more than half in 2018

20th March 2019 - 13:12pm
money matters, kingfisher, b&q, screwfix, performance, report, financial, kbb, kbbdaily

Kingfisher – the owner of Screwfix and B&Q – has reported a 52.8% drop in statutory pre-tax profit for the 2018 financial year, falling from the £682m recorded in the 2017 financial year to £322m, while like-for-like sales declined by 1.6% due to poor performance at B&Q and Castorama France.

In the UK and Ireland, sales for Kingfisher declined by 0.8% on a like-for-like basis in 2018 to £5bn “within the context of a weak consumer backdrop”. Sales at Screwfix grew by 4.1% on a like-for-like basis to reach £1.7bn, while B&Q saw like-for-like sales drop by 3% to £3.4bn.

Kingfisher said that it plans to roll out more Screwfix stores across the UK in 2019-2020, thanks to the brand achieving “very strong growth” over the last five years. The group is now targeting 800 UK stores for Screwfix, having revised its previous target of 700.

The brand currently operates from 627 stores, which is nearly double the number of stores five years ago, Kingfisher noted in its annual report for 2018, adding that it plans on expanding the Screwfix brand into new markets, namely the Republic of Ireland, France and Poland.

“We have achieved radical organisational and behavioural change across Kingfisher over the last three years,” said CEO Véronique Laury. “We’ve done this against the backdrop of rapid structural change in retail alongside high levels of macroeconomic uncertainty, which are ongoing. Navigating these conditions while maintaining focus on a transformation of this scale has required huge commitment from our people.

“During the year, the UK, Poland and Brico Dépôt France performed well, leveraging the benefits of
our transformation. Screwfix’s leading omnichannel proposition has consistently delivered strong growth in recent years and we have identified additional expansion opportunities in both the UK and in new markets, initially in the Republic of Ireland.”

Laury added: “Much of our focus over the last three years has been on building an ‘engine’ to deliver a superior customer proposition and the agility to succeed in the new retail environment. Our customers are starting to benefit from differentiated product, in store and online, at everyday low prices. Over the next year we will be accelerating our unique product activity and making our innovation more visible to customers including testing new store concepts.”

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