Kingfisher Q1 sales down as annual profits rise 33%

B&Q owner Kingfisher said current-year first-quarter sales were down 8.1% as it reported 2021/22 profits up by a third, and said it was “encouraged” by its start to the new year.

The company on Tuesday posted pre-tax profit of £1bn on sales of £13.1bn, up 6.8% and said it was “comfortable” with the current consensus of sell-side analyst expectations for 2022/23 adjusted profit before tax of £769m. Current like-for-like sales took in the period to March 22 and were up 16% on a two-year basis.

On an adjusted basis, Kingfisher which also owns Screwfix along with Castorama and Brico Depot in France, made adjusted pre-tax profit £949m in the 12 months to January 31, up from £786m. The total dividend was lifted by 50% to 12.4p a share.

Kingfisher sales have boomed during the Covid pandemic as people stuck at home during lockdown’s took on home improvement projects. Adjusted profits were largely driven by higher retail sales.

The company said it was “mindful” of the heightened macroeconomic and geopolitical uncertainty that has emerged since the start of the year.

It added that it had no exposure to the war in Ukraine and said on March 1 it stopped selling "the limited number of products directly sourced from Russian and Belarusian suppliers across the Group, and those products have been removed from our shelves".

"With regards to indirect supply, we are engaging with our suppliers to ensure materials or components are no longer sourced from Russia or Belarus."

Susannah Streeter, analyst at Hargreaves Lansdown, said the pre-tax result was "impressive given the headache of goods shortages which have beset the sector".

"It seems that the race to find more space in our homes for locked-down living has continued, as consumers look for longer term solutions to new hybrid ways of working. For now, even big ticket items like new kitchens and bathrooms are in high demand, with the showroom order book for B&Q and French chain Castorama up 72% compared to last year."

"But the company has flagged heightened uncertainty ahead and there is a risk that, while lockdown savings dwindle away as household bills shoot up, customers may become a lot more conservative with their makeover budgets in the months to come.’’