Despite flat like-for-like UK growth earlier this year, trade kitchen giant Howdens saw a drop in revenue during the back half of 2024, which it has blamed on consumer fears around the Autumn Budget leading to less spending.
In its latest trading update released today, Howdens reported it had seen a disappointing 2.2% like-for-like revenue decline in the months from July to November – a noticeable change from the 2.8% like-for-like increase it saw in the first half of the year. These combined to total a flat 0.1% growth figure across the UK in the year so far.
However, when compared with 2023, the national retailer reported a +1.7% revenue increase in the UK this year. Although not an earth-shattering growth figure, the company believes this is significant as it was, “achieved against a backdrop of challenging macro-economic conditions, with weak consumer spending, further compounded by uncertainty surrounding the Autumn Budget”.
Nonetheless, the trade giant was still impacted by the economic conditions it describes, as it saw a 0.6% drop in year-on-year UK revenue since June. This is again a significant downturn for Howdens, which recorded a 4.3% increase in its year-on-year revenue at the time of its half-year results earlier in 2024.
Outside of the UK, Howdens performed much better in terms of international revenue. Its International year-on-year revenue for 2024 so far is reported at 10.9%, which was boosted by an 18.2% increase specifically in the period from July.
This totals 1.9% in combined international and UK revenue growth compared with 2023’s figures, but a relatively flat 0.1% decrease in group revenue in the months since July.
Regarding the company’s strong growth internationally compared to its middling UK results, Howdens says that its business in France is benefiting from a new leadership team. It details that the French business is focusing specifically on developing its depot teams and strengthening its business model after a period of depot expansion.
Looking to the future, Howdens says it expects the near-term market outlook into 2025 to remain challenging, which it believes will is likely “in the absence of any meaningful change in the underlying consumer sentiment”.
However, Howdens says it is confident that its business model is the right one to address the opportunities in the KBB market, and also believes it is well placed to “continue to make excellent progress over the medium-term”.
To demonstrate its belief, Howdens also revealed that it expects to open around 30 new depots in the next year, as well as revamping around 85 of its older UK sites. In addition, it also expects to open 5 new international sites this year
Addressing the results, Andrew Livingston, CEO of Howdens, said: “Howdens has delivered another strong period of market outperformance in continued challenging conditions underlining the strength of our trade-only, in-stock business model.
“Our strategic initiatives are performing well with an emphasis on delivering immediate product availability, market-leading product ranges, and digital tools. These support our trade customers to get their projects done efficiently, affordably and right first time.
Earlier this year, Howdens also announced it was diversifying its offering by also moving into the fitted bedrooms category, a move which followed Wren’s decision to do the same thing last year.