Kingfisher sales and profits boosted by better weather
Kingfisher, the owner of B&Q and Screwfix, said its sales were boosted by good weather in its first quarter as it reported a 20.3% rise in retail profit to £142 million.
In the 13 weeks to 3 May 2014, total sales rose by 6.1% to £2.78 billion with like-for-like sales also increasing by 6.1%.
Kingfisher said the sales growth was driven by more favourable weather conditions than in the same period last year and “encouraging underlying signs” in the UK & Poland.
Sir Ian Cheshire, Kingfisher group chief executive, said: "We have made a strong start to the year, capitalising on more favourable weather conditions right across Europe to achieve sales and profit growth in France, the UK & Poland, our three largest markets. Whilst this is encouraging, the first quarter is one of our smallest and the growth achieved largely reflects comparisons with the very difficult start to last year. We will annualise stronger figures in our second quarter and so, as ever, we will look at the whole of the first half results to properly assess our underlying performance.”
The retailer’s UK and Ireland business, which comprises B&Q and Screwfix, grew its retail profit by 35.2% to £68 million as total cash gross profit rose by 7%.
B&Q UK & Ireland's total sales increased by 10.5% to £1.01 billion with like-for-like sales growing by 9.7%. Sales of outdoor seasonal and building products, which can represent up to 30% of total first quarter sales, were up around 30% benefiting from the better weather and later Easter. Sales of indoor products were up around 3%.
Meanwhile, Screwfix grew its total sales by 24.2% to £192 million with like-for-like sales surging by 12%. Kingfisher said the retailer had benefited from a strong promotional programme, the continued roll out of new outlets and the continued success of the mobile 'click, pay & collect' offer. Nine new stores were opened during the quarter, taking the total to 344.
In France where Kingfisher operates Brico Dépôt and Castorama stores, sales grew by 3.3% to £1.08 billion as trade was boosted by improved weather patterns compared to the first quarter last year,
Kingfisher said “other international” total sales increased by 15.4% to £506 million driven by like-for-like growth in Poland and Russia.
During the quarter, Kingfisher received proceeds of €236 million following the disposal of the group's 21% stake in Hornbach in March 2014. In addition, the group is continuing its exclusive negotiations to acquire Mr Bricolage in France.
Sir Ian added: "We have made a good start with our key corporate priorities this year having completed the sale of our stake in Hornbach, entered exclusive negotiations to acquire Mr Bricolage in France, opened our first store in Portugal and started to return surplus capital to shareholders. Furthermore, our self-help initiatives continue to underpin our results and as we enter the key summer trading period our focus remains on driving cash margin, managing costs tightly and delivering shareholder returns."
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