B&Q reports flat sales
Published: 03 June, 2010
LONDON: B&Q owner Kingfisher reported total sales of £2.64bn in the quarter to May, down 1.8% on a like-for-like basis. Retail profit was up 14.5%.
Sales at B&Q in the UK and Ireland were down 2.1% to £1.048bn but retail profit grew 12% to £67m.
In its statement B&Q said: "Kitchen and appliance sales performed well, up 6% benefiting from improved merchandising, new ranges and targeted promotions. Sales of decorative products were relatively resilient down around 1%. Sales of seasonal and building products were down around 5% impacted by the adverse weather and strong comparatives." Sales of outdoor products were up over 30% in 2009/10.
Ian Cheshire, group chief executive said: "We have continued to deliver solid profit growth in a tough first quarter during which our customers were impacted by adverse weather conditions across Europe and ongoing economic uncertainty.
"Sales were disrupted at the start of the quarter by heavy snow, and the prolonged cold weather also delayed the start to the outdoor spring season, contrasting with favourable conditions the previous year. However, our self-help initiatives helped us deliver flat sales whilst improving gross margin and cost productivity with the result that profit grew 12%.
The roll out of the new B&Q TradePoint in-store offer announced with the preliminary results in March 2010 remains on track, said the company. "The proposition takes the very best of B&Q (extended opening hours, convenient locations, heavy building ranges, showrooms and the rest of the stores' retail products) and adds the best of Screwfix's ranges and logistics expertise to create a merchant environment with extended trade brands and trade only prices. This offer, which is exclusive to the trade professional and unique in the UK, is expected to boost Kingfisher's low share in the professional trade market,' the company said.
National coverage of TradePoint in large B&Q stores is expected by late summer 2010 from a capital investment of around £26m plus net working capital of around £4m. The impact of the roll out will be profit neutral in 2010/11. By the end of the first quarter, B&Q completed 55 TradePoints.
Mr Cheshire said: "While this is a good start to the year, our first quarter is typically one of the least significant contributors to annual profit and so there is much still to do this year. The headwinds we anticipated at the start of the year look set to continue, but we are in good shape and well prepared."