Wickes raises profit forecast as sales remain strong

Home-improvement retailer Wickes has increased its profit predictions for Q4 of 2021 to £83 million on the back of “resilient trading”.

Having previously forecast profits between £67m and £75m for the quarter, and with current analyst predictions of around £75m, Wickes said in its latest trading update: “Wickes has continued to perform well in the fourth quarter to date, benefiting from our balanced business model, with sales in line with expectations.”

Wickes divides its sales into three sectors – DIY, trade and what it calls Do It For Me (DIFM), where it offers a design an installation service. And it is in the DIFM sector that it has seen delivered sales strengthening “as we work through an elevated order pipeline”.

The retailer added that it expected to see a higher carry-over order book in DIFM, “supported by continued strong sales, which will benefit the first half of FY2022”.

Wickes added that core sales were lower year on year “against tough comparatives”, but remained “materially ahead” on a two-year basis, driven by strong performance in its trade sector, underpinned by its digital TradePro loyalty scheme.

Wickes chief executive David Wood commented: “This has been a period of further progress for Wickes, where our focus on value, stock availability and exceptional service have underpinned our customer offer. Our forward planning and early strategic decisions have resulted in an improved profit performance, and we continue to navigate inflationary pressures and raw material constraints well.

“Clearly, this remains a time of uncertainty, however our differentiated business model leaves us well-placed to continue to outperform within a large and growing home improvement market.”

The statement added that while Wickes believes the recent changes in the Government’s Covid-related guidance would not greatly affect trading over the rest of the year, the trading environment continues to remain uncertain.

Wickes was spun-off and separated from Travis Perkins through a premium listing on the London Stock Exchange’s Main Market on April 28. Both companies now trade separately as independent, standalone businesses.

Sales for Wickes fort ethe year to December 31, 2020 were £1.35 billion with an operating profit of £61m.

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