Kingfisher celebrates quarterly figures and targets in London

(Il Sole 24 Ore Radiocor) - Kingfisher traded well on the London Stock Exchange, albeit without the initial momentum, after confirming its outlook for the year in the wake of its first quarter earnings update. The stock of Europe's number one retailer of do-it-yourself, DIY and home improvement products gained more than 5% in the early stages of the session before partially braking.

Kingfisher, which controls the B&Q and Screwfix brands in the UK and Castorama and Brico Dépot in France, announced sales of £3.3 billion for the first three months of the 2026-2027 financial year (February to April), up 1.4% on an accounting basis, unchanged at constant currencies and down 0.9% on a like-for-like basis. Underlying sales, excluding calendar and leap year effects, were down 0.7%. According to Jefferies, the performance was in line with expectations. The company pointed out that the quarter was affected by comparisons with the strong performance of the previous year, and that a late spring start affected shop footfall. Sales in the UK and Ireland increased by 0.3%, but decreased by 0.9% on a like-for-like basis. In France, sales increased by 1.4%, but decreased by 2.1% on a like-for-like basis, while in Poland, sales increased by 3.3%, but decreased by 0.2% on a like-for-like basis.

"We had a resilient start to the year, with good operational management and market share gains in an atonic market environment," said CEO Thierry Garnier. According to Jefferies, revenues were supported by a better-than-expected performance in the UK (-2% expected), offset by weaker trends in France (-1% expected) and Poland (+1.6% expected). Furthermore, in the UK, Jefferies points to the significant divergence in performance between B&Q (-4.1%) and Screwfix (+4.1%), reflecting the impact of weather conditions, with the former more affected by its greater exposure to outdoor products. The trend 'is in line with broader industry trends, with competitors also highlighting weather-related difficulties in outdoor categories,' adds Jefferies, which maintains a 'hold' rating on the stock with a target price of 291 pence.

As for the outlook, Kingfisher confirmed its forecast for the full year. The group expects an adjusted pre-tax profit of between £565m and £625m for the year ending January 2027, up from £560m recorded in the 2026 financial year. Free cash flow of 450-510 million is also expected. "While remaining mindful of the market environment, we remain fully focused on executing the strategy, gross margin discipline, cost management and delivering a smooth return to shareholders. We are confident of achieving our annual targets and well positioned to capitalise on long-term growth opportunities in our markets,' Garnier said. The ceo will leave Kingfisher within 12 months to be led by Dutchman Ahold Delhaize. The exit was announced by both companies in early May. Kingfisher said it is looking for a successor.