FY 2020/21 Technical guidance

The following guidance applies in the event of no adverse change in COVID-related confinement measures (for example, new lockdown restrictions resulting in further store closures). Please also refer below for further details regarding forward-looking statements.

Income statement:

• LFL sales outlook
  • H1 21/22 – expect mid-to-high teens LFL sales growth (previous guidance ‘low double-digit’)
  • H2 21/22 – continue to plan for LFL scenarios of -15% to -5% (2-year LFLs for H2 of -1% to +11%). Range reflects uncertainty over the macroeconomic and consumer environment in H2
• Space
  • Anticipate net space growth (excluding Russia) to impact total sales by c.+1.5%, largely from the UK and Poland. Total sales impact from the disposal of Russia will be c.-1.5%
• Costs
  • Central costs – expected to be broadly flat year on year (FY 20/21: £54m)
  • COVID-related costs – expected to be c.£15m (previous guidance c.£10m; FY 20/21: £45m)
• Net finance costs
  • Expected to decrease by c.£10m as a result of lower lease liability balance and lower non-lease interest (FY 20/21: £160m)
• Adjusted pre-tax profit
  • Anticipate H1 adjusted pre-tax profit to be in the range of c.£580-600m
  • Aiming to grow full year adjusted pre-tax profit (excluding £85m of non-recurring net cost savings in FY 20/21) ahead of sales⁽¹⁾ (previous guidance ‘in line with sales’)
• Tax rate
  • Group adjusted effective tax rate expected to be c.23%⁽²⁾ (FY 20/21: 23%)

Cash flow:

• Capital expenditure – continue to target gross capex of up to 3.5% of total sales, including c.£70m of capex deferred from FY 20/21 (FY 20/21: £281m; FY 19/20: £342m)
• Tax – as anticipated, in Q1 21/22 we paid c.£64m (including interest) to HMRC in relation to the EC state aid challenge (previous guidance c.£57m excluding interest). The full amount is being contested and is recorded as a receivable
• Dividends – target dividend cover range of 2.25 to 2.75 times, based on adjusted basic earnings per share

⁽¹⁾ Group total sales growth and adjusted pre-tax profit growth in constant currency

⁽²⁾ Subject to the blend of profit within the Group’s various jurisdictions.

Information correct as at 20 May 2021.

Forward-looking statements
You are not to construe the content of the information above as investment, legal or tax advice and you should make your own evaluation of the Company and the market. If you are in any doubt about the contents of the information above or the action you should take, you should consult a person authorised under the Financial Services and Markets Act 2000 (as amended) (or if you are a person outside the UK, otherwise duly qualified in your jurisdiction).

The financial information referenced in the information above is not audited and does not contain sufficient detail to allow a full understanding of the results of the Group. Nothing in this information should be construed as either an offer or invitation to sell or any offering of securities or any invitation or inducement to any person to underwrite, subscribe for or otherwise acquire securities in any company within the Group or an invitation or inducement to engage in investment activity under section 21 of the Financial Services and Markets Act 2000 (as amended).

Certain information may constitute "forward-looking statements" (including within the meaning of the safe harbour provisions of the United States Private Securities Litigation Reform Act of 1995), which can be identified by the use of terms such as "may", "will", "would", "could", "should", "expect", "anticipate", "project", "estimate", "intend", "continue", "target", "plan", "goal", "aim" or "believe" (or the negatives thereof) or other variations thereon or comparable terminology. These forward-looking statements include all matters that are not historical facts and include statements regarding the Company's intentions, beliefs or current expectations and those of our Officers, Directors and employees concerning, amongst other things, the Company's results of operations, financial condition, changes in global or regional trade conditions, changes in tax rates, changes to customer preferences, liquidity, prospects, growth and strategies, acts of war or terrorism worldwide, work stoppages, slowdowns or strikes, public health crises, outbreaks of contagious disease, environmental disruption or political volatility. By their nature, forward-looking statements involve inherent risks, assumptions and uncertainties that could cause actual events or results or actual performance of the Company to differ materially from those reflected or contemplated in such forward-looking statements. For further information regarding risks to Kingfisher's business, please consult the risk management section of the Company's Annual Report (as published). No representation or warranty is made as to the achievement or reasonableness of and no reliance should be placed on such forward-looking statements.

The Company does not undertake any obligation to update or revise any forward-looking statement to reflect any new information, change in circumstances, or change in the Company's expectations.