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Screwfix boosts Kingfisher's profits | Screwfix boosts Kingfisher's profits |
(35 minutes later) | |
Kingfisher, the B&Q and Screwfix owner, has reported sharply higher profits, boosted by resilient sales in the UK and a weaker pound. | |
Pre-tax profits rose 48% to £759m for the year to 31 January, from £512m. | |
However, chief executive Veronique Laury warned of future uncertainty caused by Brexit and the French presidential elections. | |
The cautious outlook sent Kingfisher shares down almost 5%, making it the biggest faller on the FTSE 100. | |
B&Q closures | B&Q closures |
The DIY retailer also trades as Castorama and Brico Depot in France, where sales were much weaker. | The DIY retailer also trades as Castorama and Brico Depot in France, where sales were much weaker. |
Despite the rise in profits, Ms Laury warned: "Looking forward, the EU referendum has created uncertainty for the UK economic outlook and we remain cautious on the outlook for France, especially in light of the forthcoming presidential elections." | Despite the rise in profits, Ms Laury warned: "Looking forward, the EU referendum has created uncertainty for the UK economic outlook and we remain cautious on the outlook for France, especially in light of the forthcoming presidential elections." |
Under her management, the retailer is undergoing a five-year restructuring programme designed to close unprofitable shops, improve technology and unify products. | Under her management, the retailer is undergoing a five-year restructuring programme designed to close unprofitable shops, improve technology and unify products. |
The group said it had finished its B&Q store closure programme, which has seen it shut 65 shops and cut about 3,000 jobs in the UK and Ireland. | The group said it had finished its B&Q store closure programme, which has seen it shut 65 shops and cut about 3,000 jobs in the UK and Ireland. |
UK like-for-like sales rose 5.9% following strong demand at Screwfix. | UK like-for-like sales rose 5.9% following strong demand at Screwfix. |
Total B&Q sales fell 3.3% after its store closure programme. | Total B&Q sales fell 3.3% after its store closure programme. |
Total adjusted sales rose 8.7% to £11bn. | Total adjusted sales rose 8.7% to £11bn. |
'Solid results' | 'Solid results' |
It opened 60 new Screwfix outlets over the year, expanding its chain to 517, with plans for future expansion. | It opened 60 new Screwfix outlets over the year, expanding its chain to 517, with plans for future expansion. |
On the international front, Poland provided buoyant like-for-like sales that increased by 5.1% thanks to a better product range. | On the international front, Poland provided buoyant like-for-like sales that increased by 5.1% thanks to a better product range. |
A weaker pound also boosted its overseas profits by £52m. | A weaker pound also boosted its overseas profits by £52m. |
Neil Wilson, senior market analyst at ETX Capital said: "Solid enough results for Kingfisher, with a good performance from Screwfix, but evidence of a slight slowdown in the second half of the year might be cause for concern, while a lot of the gains seem to be down to the weak pound. | Neil Wilson, senior market analyst at ETX Capital said: "Solid enough results for Kingfisher, with a good performance from Screwfix, but evidence of a slight slowdown in the second half of the year might be cause for concern, while a lot of the gains seem to be down to the weak pound. |
"Profits beat estimates, but investors are showing signs of concern." | "Profits beat estimates, but investors are showing signs of concern." |
He said Screwfix was the "standout performer", demonstrating the resilience of the UK economy following the EU referendum last June. | He said Screwfix was the "standout performer", demonstrating the resilience of the UK economy following the EU referendum last June. |
He said this suggested Britain's plumbers, electricians and other trades were busy building, despite Ms Laury's concerns about Brexit. | He said this suggested Britain's plumbers, electricians and other trades were busy building, despite Ms Laury's concerns about Brexit. |
Sales at Screwfix rose 23.2%, or 13.8% on a like-for-like basis, driven by its specialist trade desks which are exclusive to plumbers and electricians. | Sales at Screwfix rose 23.2%, or 13.8% on a like-for-like basis, driven by its specialist trade desks which are exclusive to plumbers and electricians. |
He warned the worry was the slowdown in the second half of the year, which may reflect some pullback in UK consumer spending, in addition to seasonal factors. | He warned the worry was the slowdown in the second half of the year, which may reflect some pullback in UK consumer spending, in addition to seasonal factors. |
New chairman | New chairman |
It has also announced Andy Cosslett is to take over as chairman, replacing Daniel Bernard, who is retiring after eight years in the job. | It has also announced Andy Cosslett is to take over as chairman, replacing Daniel Bernard, who is retiring after eight years in the job. |
Mr Bernard welcomed his replacement in a statement. | Mr Bernard welcomed his replacement in a statement. |
"He is a very experienced board director with strong branding and consumer credentials gained at companies such as Unilever, Cadbury Schweppes and InterContinental Hotels. | "He is a very experienced board director with strong branding and consumer credentials gained at companies such as Unilever, Cadbury Schweppes and InterContinental Hotels. |
"As we are now at the end of the first year of our exciting five-year transformation plan, I believe it is the right time for a new chairman to oversee its full delivery and Andy is uniquely placed to do this." | "As we are now at the end of the first year of our exciting five-year transformation plan, I believe it is the right time for a new chairman to oversee its full delivery and Andy is uniquely placed to do this." |
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