B&Q sales suffer amid store closures

Home improvement retailer B&Q has reported declining sales in 2017.

According to its end of year results, B&Q’s total sales fell by 5.3% to £3.4 billion, which the Kingfisher Group claimed reflected the annualisation of the completed store closure programme.

Like-for-like sales fell by 2.8% after a 0.7% benefit from sales transference associated with store closures. Like-for-like sales of seasonal products were down by 2.8%, while sales of non-seasonal products, including showroom, were also down by 2.8%.

Total digital sales, including home delivery, continued to make good progress with sales up by 11%, representing 4% of total sales for the retailer.

Sales for Kingfisher UK and Ireland increased by 0.4% to £5bn, which was driven by the strong performance of Screwfix. Like-for-like sales were up 0.6%, which was also impacted by modest price inflation.

For the group as a whole, sales increased by 3.8% to £11.6bn, but adjusted pre-tax profit fell by 8.1% to £683 million.

Véronique Laury, chief executive, said: “We have made good progress in this second year of our ambitious five-year transformation after a significant step up in the level of activity. For the second year in a row, all our key strategic milestones have been met and I am really pleased to say that we are starting to see tangible delivery of our plan.

“The changes are now visible across our stores and online. Over a third of our ranges have now been unified and they are being well received by customers. We are buying as one and are starting to see the customer and financial benefits coming through, both in sales and gross margins.

“Our digital initiatives are gaining momentum as we enter the final year of rollout of our unified IT platform. I am also pleased to see that our operational efficiency initiatives, focusing initially on goods not for resale, continue to deliver and are now gathering pace as we start to unlock further opportunities.

“Our performance this year has been mixed, however, with solid growth at Screwfix and Poland, offset by continued weaker sales in France and some business disruption, principally reflecting product availability and clearance. We are acting on the causes of this disruption, however next year will be another big year in our transformation plan. The pace of change is quick and impactful but necessary as we build the new One Kingfisher engine to support our ambition to be the leading home improvement company, based on putting customer needs first. The outlook for our main markets is also mixed. The UK is more uncertain, France is encouraging yet volatile, while the market in Poland remains supportive.

“Given our good progress so far, and supported by our highly engaged teams, I remain confident in our ability to deliver our plan and in the customer and financial benefits it will generate.”

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