Third Quarter Trading Update to 31 October 2017

21 November 2017

 

Kingfisher reports sales of £3.0 billion, LFL(1) down 0.5%

  Sales
2017/18
% Total
Change
% Total
Change
% LFL
Change
  £m Reported Constant
currency
Constant
currency
UK & Ireland 1,274 +2.5% +2.5% +1.5%
- B&Q UK & Ireland 875 (2.8)% (2.9)% (1.9)%
- Screwfix 399 +16.6% +16.6% +10.2%
France 1,153 +0.4% (3.5)% (4.1)%
- Castorama 627 +1.2% (2.6)% (3.2)%
- Brico Dépôt 526 (0.7)% (4.6)% (5.2)%
Other International 616 +9.3% +3.2% +2.7%
- Poland 379 +11.9% +6.1% +6.0%
- Russia 109 +8.6% (1.4)% (3.7)%
- Spain 79 (2.0)% (5.5)% (4.0)%
- New Country Development(2) 49 n/a n/a n/a
Total Group 3,043 +3.0% +0.3% (0.5)%
 
  • Q3 LFL down 0.5% reflecting continued weak sales in France and slightly lower impact from business disruption than H1
  • Remain comfortable with FY 17/18 consensus underlying PBT expectations (3)
  • Remain on track to deliver our full year strategic milestones
  • Returned a further £237m (76m shares) year to date via share buyback of previously announced c.£600m capital return (4)

Véronique Laury, Chief Executive Officer, said:

“Q3 has followed a similar course to the first half. We have seen strong growth at Screwfix and Poland offset by continued weak sales in France, alongside some business disruption from our ONE Kingfisher plan, principally reflecting product availability and clearance. We continue to act on the causes of this disruption, which we are confident will ease.

“We remain on track to deliver our full year strategic milestones, for the second year in a row. With plans in place to support our overall performance, we remain comfortable with full year profit expectations.

“We remain confident in our ability to deliver our long-term plan and in the financial and customer benefits it will generate. Early customer reaction to our new ranges continues to be encouraging. We recognise that the transformation plan involves a lot of change for our colleagues and appreciate their continued hard work and expertise.”

Q3 trading highlights by division (in constant currencies):

UK & IRELAND

  • Total sales +2.5%. LFL +1.5% reflecting continued strong Screwfix performance and modest price inflation
    • B&Q UK & Ireland sales -2.9% (LFL -1.9%) reflecting annualisation of completed store closure programme. LFL of seasonal -7.1% reflecting a strong comparative (Q3 16/17: +5.3%). LFL of non-seasonal, including showroom -0.6%
    • Screwfix sales +16.6%. LFL +10.2% driven by its leading digital capability, new and extended specialist ranges and new outlets

FRANCE

  • Total sales -3.5% (LFL -4.1%). Sales for the home improvement market (Banque de France data(5)) +0.6% in Q3
    • Castorama sales -2.6% (LFL -3.2%). LFL of seasonal -9.3% reflecting a strong comparative (Q3 16/17: +5.9%). LFL of non-seasonal, including showroom -2.0%
    • Brico Dépôt sales -4.6% (LFL -5.2%)

OTHER INTERNATIONAL

    • Sales in Poland +6.1% (LFL +6.0%) reflecting a continued good performance in a supportive market. LFL of seasonal +4.7% against a strong comparative (Q3 16/17: +7.8%). LFL of non-seasonal, including showroom +6.1%

FY 17/18 technical guidance:

Income statement:

  • Following proposed legislation in France, a corporate tax surcharge is expected to increase our group tax charge by c. €25m for FY 17/18. This is not expected to recur in subsequent years

Footnotes

(1) Like-for-like sales growth representing the constant currency, year on year sales growth for stores that have been open for more than a year
(2) Brico Dépôt Romania, Brico Dépôt Portugal and Screwfix Germany
(3) Analyst consensus of underlying profit before tax of £785m for FY 17/18 at FX Euro/GBP rate of 1.15, see http://www.kingfisher.com/index.asp?pageid=79 for more detail. Underlying profit before tax is used to report the performance of the underlying business at a Group level, including the sustainable benefits of our transformation programme. This is stated before the short-term costs associated with our transformation programme, exceptional items and FFVR.
(4) Through to end of FY 18/19 (over and above the annual ordinary dividend); now returned £437m of the c.£600m
(5) Includes relocated and extended stores http://webstat.banque-france.fr/en/browse.do?node=5384326

Contacts

Investor Relations
+44 (0) 20 7644 1082
investorenquiries@kingfisher.com

Media Relations
+44 (0) 20 7644 1030
corpcomms@kingfisher.com

Teneo Blue Rubicon
+44 (0) 20 7260 2700
Kfteam@teneobluerubicon.com

This announcement can be downloaded from www.kingfisher.com. Data tables for Q3 sales FY17/18 are available for download in excel format at http://www.kingfisher.com/index.asp?pageid=59. We can be followed on Twitter @kingfisherplc with the Q3 results tag #KGFQ3. 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 our full year results on 21 March 2018. The results will be presented as an audio webcast followed by a live Q&A.

Forward-looking statements

You are not to construe the content of this announcement 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 this announcement 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).

This announcement has been prepared in relation to the financial results for the Quarter ended 31 October 2017. The financial information referenced in this announcement is not audited and does not contain sufficient detail to allow a full understanding of the results of the group.  Nothing in this announcement 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).

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