Half Year to 31 July 2016

20 September 2016

 

Sales up 2.7% and retail profit up 8.7%, in constant currencies
Underlying pre-tax profit of £436m, up 13.5%
Good early progress on ONE Kingfisher

Financial highlights

      % Total Change % Total Change % LFL* Change
  2016/17 2015/16 Reported Constant currency Constant currency
Adjusted sales* £5,749m £5,382m +6.8% +2.7% +3.3%
Retail profit* £464m £410m +13.1% +8.7%  
Underlying* pre-tax profit £436m £384m +13.5%    
Adjusted* pre-tax profit £418m £384m +8.9%    
Underlying basic EPS 14.2p 12.3p +15.4%    
Adjusted basic EPS 13.6p 12.3p +10.6%    
Half year dividend 3.25p 3.18p +2.2%    
Net cash* £898m £435m n/a    

*Throughout this release ‘*’ indicates first instance of a term defined in the Glossary (section 5).
A reconciliation to statutory amounts is set out in the Financial Review (Section 4).

 
  • Total adjusted sales in constant currencies up 2.7% (UK & Ireland* +3.1%; France* +0.3%; Other International* +7.5%)
  • Retail profit in constant currencies up 8.7% (UK & Ireland +8.8%; France +1.6%; Other International +34.2%)
  • Underlying pre-tax profit of £436m, up 13.5% driven by UK and Poland profit growth and £17m favourable FX movements on the translation of non-sterling retail profits
  • Returned £317m of cash to shareholders year to date (£157m dividend; £160m buyback)
  • Net cash of £898m including significant working capital timing benefits

ONE Kingfisher

Good early progress and on track with first year strategic milestones:

  • Unified & Unique Offer
    • Implementing first unified ranges; sales are encouraging and cost of change in line with expectations
    • New ONE Offer & Supply Chain organisation (OSC) global functions and roles started from early June; initial set up costs lower than anticipated
  • Digital
    • Unified IT platform now in all B&Q stores (ahead of plan) with back office & supply chain underway; first Castorama France pilot store on track for Q3
  • Operational efficiency
    • B&Q store closures 80% complete: 52 to date of the 65 planned; 50 lease exits secured
    • Goods Not For Resale* (GNFR) benefits delivering earlier than plan: £12m in H1; raising FY guidance from up to £20m to up to £25m

No change to 5 year transformation cost* guidance of c.£800m:

  • Updated cost guidance for FY 2016/17: transformation P&L costs of c.£60m; transformation exceptional costs of up to £10m

Statutory reporting:

  2016/17 2015/16 % Change Reported
Statutory sales* £5,749m £5,492m +4.7%
Statutory pre-tax profit £427m £386m +10.6%
Statutory post-tax profit £321m £318m +0.9%
Basic EPS 14.1p 13.6p +3.7%

Véronique Laury, Chief Executive Officer, said:

“It has been a productive first half. We have delivered a good 'business as usual' result with both sales and profit growth. Performance has been driven by Poland and the UK, especially Screwfix, and a stable profit performance in France. This has been achieved alongside managing the start of our ambitious transformation plan, based on creating a unified company where customer needs come first.

“In the UK, the EU referendum has created uncertainty for the economic outlook, even though there has been no clear evidence of an impact on demand so far on our businesses. In France we remain cautious on the short term outlook.

“Looking longer term, we are starting to build solid foundations to enable us to deliver our five year transformation, which is our key growth driver. We are making good progress on our strategic milestones for this first year and we are on track. The level of transformation activity will increase significantly, however given the expertise and energy of our colleagues we continue to feel confident about the challenges ahead.”

Contacts:

Investor Relations
+44 (0) 20 7644 1029

Media Relations
+44 (0) 20 7644 1030

Teneo Blue Rubicon
+44 (0) 20 7260 2700

This announcement can be downloaded from www.kingfisher.com or viewed on the Kingfisher IR iPad App. We can be followed on Twitter @kingfisherplc with the half year results tag #KGFHY.

Kingfisher American Depository Receipts are traded in the US on the OTCQX platform: (OTCQX: KGFHY) http://www.otcmarkets.com/stock/KGFHY/quote

Our next announcement will be the Q3 trading update (sales only) for the period ended 31 October 2016 on 22 November 2016.