B&Q owner Kingfisher has blamed a wet and cold Easter for a dip in sales of barbecues and garden products, but the home improvement chain is hoping to make up lost ground during the current heatwave. The company, which also owns Screwfix in the UK and Castorama and Brico Dépôt across six European countries, reported that like-for-like sales at established outlets in the UK and Ireland fell 0.9% between February and April.
Sales Performance
Within that figure, B&Q sales dropped 4.1%, while Screwfix revenue climbed 4.1%. Overall group sales were down 0.9% in the three-month period, with declines also at Castorama and Brico Dépôt. Kingfisher attributed the dip to rain and cold weather around Easter, which deterred customers from purchasing BBQs, garden furniture, and plants. Seasonal products account for a fifth of the company's revenues.
Product Categories
B&Q also saw a decline in bathroom fixture sales, partially offset by a 4.5% rise in kitchen sales after introducing new ranges. The overall UK market for bathroom sales fell 2% in the first quarter, while the kitchen market remained flat. The company plans further investment in its own-brand bathroom ranges later this year.
Profit Outlook
Despite the sales dip, Kingfisher stuck to its full-year outlook, expecting a pre-tax profit of between £565m and £625m. This forecast cheered investors, driving its share price 3% higher on Tuesday, making it the top riser on the FTSE 100 index.
Thierry Garnier, Kingfisher's chief executive, said: “We delivered a resilient start to the year, executing well and gaining market share against a soft market backdrop. While mindful of the consumer environment, we remain absolutely focused on delivering our strategy, disciplined gross margin and cost management, and consistent shareholder returns.”
Analyst Commentary
Russ Mould, investment director at AJ Bell, commented: “Blaming the weather for weak trading is often seen in the ‘dog ate my homework’ category of excuses by the market, but the fact it has not forced any downgrades means Kingfisher has kept investors on side. Among the areas of positivity is the continued strong growth in the Screwfix business. Kingfisher, like several of its peers, is pursuing trade customers, who are often more reliable and consistent sources of revenue than ordinary consumers. This strategy is paying off in spades as the company makes market share gains.”
Kingfisher's sales to trade customers rose 17%, excluding Screwfix, highlighting the importance of this segment as consumer spending pressures build.
