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UK’s Kingfisher boosted by ‘grow your own’ plant sales
Global Banking & Finance Review®
Company
By James Davey
LONDON (Reuters) -British home improvement retailer Kingfisher reported first quarter sales significantly ahead of its pre-pandemic performance, helped by strong “grow your own” plant sales and other garden products.
The group, which owns B&Q and Screwfix in Britain and Castorama and Brico Depot in France and other markets, said on Monday both the do-it-yourself (DIY) and trade market were proving “resilient” and it was maintaining its full-year guidance.
Kingfisher said B&Q sold 730,000 units of vegetable plants, such as carrots and peas, 170,000 units of tomato plants, 160,000 units of strawberry plants and 370,000 units of herb plants. Sales of summerhouses were up 72% year on year.
Shares in Kingfisher were up 2.8% at 0740 GMT, paring 2022 losses to 25%.
It said group like-for-like sales fell 5.4% in the quarter to April 30 year on year but were up 16.2% on a three-year basis.
It said it was making strong market share gains and had good momentum into the second quarter with like-for-like sales down 2.5% for the two weeks to May 14 but up 21.8% on a three-year basis.
More people discovered or rediscovered DIY during the COVID-19 crisis as they spent more time at home, had fewer leisure options and travelled less.
Kingfisher said it was continuing to manage inflation pressures effectively and product availability was good, approaching pre-pandemic levels.
Despite economic uncertainty, it reiterated full-year 2022-23 guidance for adjusted pretax profit of about 770 million pounds ($967.5 million), down from 949 million pounds in 2021-22 when sales were boosted by the pandemic.
It said it would return a further 300 million pounds of surplus capital through another share buyback programme.
“We are focused on delivering on our strategic objectives and growth initiatives, including the growth of our scalable e-commerce marketplace, the expansion of Screwfix in the UK and France, (and) new store openings in Poland, further increasing our trade customer base,” said Chief Executive Thierry Garnier.
($1 = 0.7959 pounds)
(Reporting by James Davey; Editing by Elizabeth Piper and Edmund Blair)
DIY stands for 'Do It Yourself', referring to the practice of creating, building, or repairing things on your own, often as a hobby. It became popular during the COVID-19 pandemic as people spent more time at home.
Vegetable plants are plants cultivated for human consumption. They include various species such as carrots, peas, tomatoes, and strawberries, which are often grown in home gardens or greenhouses.
Inflation is the rate at which the general level of prices for goods and services rises, eroding purchasing power. It is often measured by the Consumer Price Index (CPI).
Market share is the portion of a market controlled by a particular company or product. It is typically expressed as a percentage of total sales in the market.
A share buyback is when a company purchases its own shares from the marketplace, reducing the number of outstanding shares. This can increase the value of remaining shares and is often seen as a sign of confidence in the company's future.
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