Kingfisher benefits from DIY boom during lockdown
B&Q owner Kingfisher saw its first half adjusted pre-tax profit rise by 23.1% to £415 million as more people worked on DIY projects during the Covid-19 lockdown.
In the six months to 31 July, sales dropped by 1.3% overall to £5.92 billion, although poorer sales in the first quarter were partially offset by a strong recovery in the second.
After falling by 21.8% in the first quarter, sales at B&Q increased by 28% in the next three month period. This meant sales climbed by 4.1% over the half year. Meanwhile, sales at Screwfix fell by 4.7% in the first quarter but improved to an uplift of 2.4% in the second to give a first half decline of 1.1%.
Kingfisher said it has made an encouraging start to its second half of the year with third quarter group like-for-like sales up 16.6%.
Thierry Garnier, Kingfisher chief executive, said: “We delivered a resilient financial performance in the first half of the year, with the adverse impact of Covid-19 in Q1 offset by a strong recovery in Q2. This recovery has continued into Q3 to date, with growth across all banners and categories.
“The crisis has prompted more people to rediscover their homes and find pleasure in making them better. It is creating new home improvement needs, as people seek new ways to use space or adjust to working from home. It’s also clear that customers are becoming more comfortable with ordering online. And delivering value to consumers is imperative against a challenging economic backdrop.”
The results mean that Kingfisher’s retail profit rose by 17.7% in constant currency, largely driven by lower overall costs and the performance at B&Q.
Sales in France and the retailer’s Iberia region dropped by 5.9% and 22.3% respectively in the half year. In contrast, sales in Poland and Romania climbed by a respective 3.5% and 9.2%.
Garnier added: “Looking forward, while the near term outlook is uncertain, the longer term opportunity for Kingfisher is significant. There is a lot more to do, but the new team and new plan is now established in the business and we are committed to returning Kingfisher to growth.”
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