Interim results for the 26 weeks ended 31 July 2010
16 September 2010
Trading Review - FRANCE
|Sales £m||2010/11||2009/10||% Change (Reported)||% Change (Constant)||% LFL Change|
|Retail profit £m||2010/11||2009/10||% Change (Reported)||% Change (Constant)|
France includes Castorama and Brico Dépôt.
2010/11: £1 = 1.16 euro (2009/10: £1 = 1.12 euro)
*Banque de France data for Feb-July 2010 including relocated and extended stores
**Private building market (Jan-Dec 09) according to UNIBAL. No 2010 data yet available.
All trading commentary below is in constant currencies.
Kingfisher France outperformed the market with self-help initiatives driving sales ahead 2.9% to £2.2 billion (+1.4% LFL, +1.6% on a comparable store basis). Across the two businesses, three new stores were opened and three were revamped, adding around 2% new space.
Retail profit grew 13.7% reflecting the sales growth and higher gross margins (+100 basis points) from a sharp increase in direct sourcing, continued buying optimisation benefits and fewer promotions year on year.
Castorama total sales grew by 4.1% to £1.2 billion (+2.6% LFL, +3.1% on a comparable store basis). According to Banque de France* sales for the market on a comparable store basis were up around 1%. Castorama’s outperformance was supported by progress with its store modernisation programme (60% of total selling space now completed), new and innovative range introductions and the new ‘Do-it-Smart’ marketing campaign aimed at making home improvement projects easier for customers.
Seasonal categories were up around 5% LFL boosted by favourable weather and new garden furniture ranges. Non-seasonal sales were up around 3% across most categories with decorative performing particularly well supported by a new catalogue.
Brico Dépôt, which more specifically targets the trade professional, delivered total sales growth of 1.4% to £1.0 billion (-0.2% LFL). The trade market**, which last year declined by 11%, appears to have improved following a pick-up in new housing starts and planning consents.
Self-help initiatives to drive sales progressed well in H1 including an up-weighted programme of range refreshment, more ‘arrivages’ promotions (rolling programme of one-off special buys) and more frequent product catalogues to reinforce Brico Dépôt’s value credentials. New kitchen ranges introduced last year performed well (+10% LFL).