(Alliance News) - Kingfisher PLC on Tuesday maintained annual guidance, despite a slight drop in first quarter sales, as growth in the UK & Ireland was offset by a weaker showing in France.
In the three months to April 30, the London-headquartered do-it-yourself retailer said group sales fell 0.3% to GBP3.26 billion on-year from GBP3.27 billion a year prior. At constant currency, sales rose 0.3%, however.
In the UK & Ireland, sales rose 2.6% on a reported basis to GBP1.63 billion. Kingfisher highlighted market share gains at B&Q supported by strong e-commerce and TradePoint sales, plus market share gains and positive like-for-like sales at Screwfix.
In France, however, sales declined 8.1% to GBP1.03 billion, although Kingfisher said this was in line with its expectations. Here, the firm said Castorama and Brico Depot had performed broadly in line with the weaker market.
Overall, Kingfisher noted the largest like-for-like sales growth, 1.9%, came from seasonal items despite unfavourable weather in April. These account for 19% of overall sales.
Sales of big-ticket items, which account for 15% of sales, slumped 6.3% like-for-like. Sales of core items, which generates the bulk of Kingfisher's revenue, declined 0.3% like-for-like.
So far in the second-quarter, sales are down 2.5% on-year on a like-for-like basis. Nonetheless, the firm still expects adjusted pretax profit for the full-year between GBP490 million and GBP550 million, which would be at least 3.2% lower than GBP568 million in financial 2024 ended January 31. It expects free cash flow of GBP350 million to GBP410 million, down at least 20% from GBP514 million.
On the overall market outlook for 2024, Kingfisher said it remains "cautious due to the lag between housing demand and home improvement demand."
Chief Executive Thierry Garnier said: "Trading in the first quarter has been in line with our expectations. We have seen continued resilience in our core categories, although 'big-ticket' sales have been weak reflecting the broader market as expected."
"We continue to drive our strategic priorities at pace and remain focused on delivering market share growth. Our e-commerce sales grew by 12.7% and we successfully expanded our marketplace model to France. We delivered further expansion of Screwfix in France, and advanced our data, AI and retail media initiatives."
He said the firm remains "focused" on driving productivity gains and maintaining tight control of 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," he added.
Shares in Kingfisher fell 0.7% to 262.34 pence in London on Tuesday morning.
By Jeremy Cutler, Alliance News reporter
Comments and questions to newsroom@alliancenews.com
Copyright 2024 Alliance News Ltd. All Rights Reserved.
Kingfisher (KGF)