Second Quarter Pre-Close Update

RNS Number : 7749K

Kingfisher PLC

21 July 2011

 



Second Quarter pre-close update to 16 July 2011

Kingfisher today reports total sales up 1.0% in constant currencies, down 0.5% on a like-for-like basis, for the 11 weeks to 16 July 2011

Constant currencies	11 weeks to 16 July 2011		24 weeks to 16 July 2011
Retail Sales (1)	% Total Change	% LFL  Change	% Total Change	% LFL Change
France (2)	4.9%	3.7%	5.7%	4.6%
UK (3)	(4.9)%	(5.5)%	(1.3)%	(1.8)%
Other International (4)	5.4%	1.4%	6.8%	2.5%
Total Group	1.0%	(0.5)%	2.9%	1.5%

(1)   All figures are on a constant currency basis. Joint Venture (Koçtaş JV) and Associate (Hornbach) sales are not consolidated. Data is provided for the 24 and 11 weeks to 16 July 2011, with the exception of Russia and China which are reported for the 26 and 13 weeks to 30 June 2011.

(2)   Castorama and Brico Dépôt.

(3)   B&Q in the UK & Ireland and Screwfix.

(4)   Poland, China, Spain and Russia.

Ian Cheshire, Kingfisher's Group Chief Executive, said:

"As anticipated, conditions in our second quarter were tougher than the first quarter which benefitted from favourable weather. However, we remain on track year to date with strong sales growth in France and on-going sourcing initiatives supporting our profit growth. The UK market remains challenging compounded by disruption in the second quarter from heavy stock clearance activity by a major competitor closing down. This clearance activity is now largely complete and looking ahead I am delighted that we have been able to secure excellent new sites for B&Q. Gross margins are ahead in all our major markets so far this quarter, supported by more direct sourcing and the gradual introduction of common ranges.

"These are testing times for retailers, particularly in the UK, but also an opportunity for strong businesses such as ours to strengthen their position. We expect to emerge from this year in excellent shape and well prepared to start delivering the next phase of our growth plans."

All figures and comments below refer to the 11 weeks to 16 July (1) in constant currencies

Trading review by division:

FRANCE

Sales in France grew 4.9% (+3.7% LFL).Castorama sales grew 2.5% (+1.9% LFL), supported by new ranges and its store modernisation programme, which was offset in part by a later than usual start to the summer season. Brico Dépôt sales were up 8.1% (+6.1% LFL) benefitting from a continued extensive programme of range refreshment and a pick-up in new housing starts and planning consents. Gross margins in France continued to benefit from increased direct sourcing and continued buying optimisation benefits.

UK & IRELAND

Sales in the UK & Ireland were down 4.9% (-5.5% LFL). B&Q total sales were down 6.7% (-6.7% LFL). Sales of outdoor seasonal products were down over 20% impacted by a strong Q1 performance (+15%), adverse weather and the stock clearance activity following the recent closure of the UK's fourth largest DIY operator with around 180 stores. Indoor project sales were broadly flat however, benefitting from improved merchandising, targeted promotions and the roll out of TradePoint, which continues to progress well. Gross margins are expected to be up despite tough comparatives (Q2 2010/11: +200 basis points) due to sales of higher margin products and more direct sourcing. Screwfix sales grew by 10.5% boosted by plumbing and electrical trade initiatives and the continued roll out of new outlets.

OTHER INTERNATIONAL

Sales in other international markets grew 5.4% (+1.4% LFL). Sales in Poland were up 4.7% (+0.3% LFL) in a more stable consumer environment. Sales in Russia were up 29.8% and sales in Spain were up 3.5%. B&Q China sales declined 7.2% (-5.4% LFL) reflecting fewer stores compared with last year and a challenging housing market.                                                                                                                                                                                                                                                                                                                                                                                                               

Delivering Value

Progress continued with the final year of the seven step programme to improve cash returns and deliver a step-change in shareholder value. We also made progress mobilising the next stage of our development known as 'Creating the Leader'. This phase will focus on a number of self-help initiatives to drive sales, margin and cost productivity across the Group under three general themes - making home improvement easier for customers, developing a world class core common range and accelerating our expansion.

Enquiries:

Ian Harding, Group Communications Director	020 7644 1029
Sarah Gerrand, Head of Investor Relations	020 7644 1032
Nigel Cope, Head of Media Relations	020 7644 1030
Clare Haines, Media Relations Officer	020 7644 1286
Brunswick	020 7404 5959

Further copies of this announcement can be downloaded from www.kingfisher.com or by application to: The Company Secretary, Kingfisher plc, 3 Sheldon Square, London, W2 6PX. Kingfisher's interim results for the six months to 30 July 2011 will be announced on 15 September 2011.    

Forward-looking statements:

The financial information contained in this announcement has not been audited. Certain statements made in this announcement are forward-looking statements. Such statements are based on current expectations and are subject to a number of risks and uncertainties that could cause actual results to differ materially from any expected future results in forward-looking statements.

Company Profile:

Kingfisher plc is Europe's leading home improvement retail group and the third largest in the world, with around 900 stores in eight countries in Europe and Asia. Its main retail brands are B&Q, Castorama, Brico Dépôt and Screwfix. Kingfisher also has a 50% joint venture business in Turkey with the Koç Group, and a 21% interest in, and strategic alliance with, Hornbach, Germany's leading large format DIY retailer.  

 

END

 

 

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