Commercial Property News
Kingfisher delight the market as H1 pre-tax profits surge 22.9%
Kingfisher Plc, owners of B&Q and Screwfix, today pleased the market with a 22.9% increase in H1 adjusted pre-tax profits to £402 million, up from £347 million last year, from sales that have slipped 0.9% to £5454 million.
In the UK & Ireland profits were up 15.8% to £171 million, as a result of a campaign focussed on returning the sales margin to 7%, achived largely by cost cutting on distribution by direct deliveries to the 330 B&Q stores and reducing theft. Total B&Q sales were down 3.7% on a LFL basis, but in the stores with a TradePoint department, sales to the 250,000 registered trade customers have increased from 9% to 13% of store sales.
The Screwfix business is expanding it's estate, 3 new locations have been opened so far this year, taking the total to 150, with a further 7 scheduled. This firm is targetting plumbers and electricians with specialist counters in leading stores.
Ian Cheshire, Group Chief Executive, said:
"We have traded well with profit again strongly ahead and financial debt reduced. Our Delivering Value programme of self-help initiatives is working well, meaning Kingfisher now generates significantly higher profits and cash flow from its operations and a much better return on capital for its shareholders.
"As we have consistently said, the immediate outlook for consumer spending is fragile, particularly in the UK where it is likely to remain challenging for some time. Our continued profit growth will come from our well-established self-help initiatives, including sourcing more products through our global network and vigorously driving operating cost efficiencies. At the same time our strong balance sheet and cash flow enables us to continue to invest more this year to grow our business, refresh our stores and introduce new products and services to provide the inspiration and solutions our customers want to help them improve their homes."
Kingfisher shares rose yesterday as news of the results leaked out and closed up 10p at 219p, valuing the business at £5.17 billion.
Thu, 16th Sep 2010