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Kingfisher LFLs fall 5.8% in Q4

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Home and DIY retail group Kingfisher saw like-for-like (LFL) sales in the UK & Ireland dip 5.8 per cent in its final quarter due to bad weather and ongoing weak consumer confidence, it has been announced today.

While total sales in the region rose 2.9 per cent in the 14 weeks to February 2nd 2013 compared with the 13 week period a year earlier, on a comparable 13 week basis sales declined 4.2 per cent.

Home and DIY retailer B&Q decreased by 6.4 per cent on a comparable 13 week basis, reaching £842 million for the 14 weeks and the group blamed weak consumer sentiment for the fall.

In a trading statement, Kingfisher noted that B&Q’s disappointing sales fall amid a “particularly challenging environment in Ireland”, following news earlier this month that its Irish business has called in an Examiner to its nine stores in the hopes of improving sales.

Meanwhile, Screwfix saw total sales jump 10.3 per cent to £155 million as its ‘click, pay & collect’ offer continued to bear fruit and a roll-out of new outlets proved beneficial.

Its French operation Castorama also reported a total sales rise, up 1.5 per cent to £494 million though LFLs dropped 0.4 per cent compared with the same period last year and Kingfisher Group CEO Ian Cheshire conceded that conditions remain difficult.

“We have had a tough fourth quarter, ending what has been a tough year impacted by unfavourable foreign exchange, particularly poor weather in the UK and weaker consumer confidence in our major markets,” he said.

“Thanks to the hard work of our teams and our established programme of self-help initiatives, we end the year in good shape with a strong balance sheet and higher market share.

“Looking ahead we will continue to actively manage the business in these challenging markets with particular focus on improving our customer offer, optimising our cash generation and delivering shareholder value.”

However, experts have warned that the reduced spending power of consumers and erratic weather have exposed the group in an increasingly slow market.

Analyst firm Conlumino’s Research Director Matt Piner said: “The UK DIY market remains cutthroat with sales falling by around £1 billion in 2012 and the relatively recent exit of Focus in 2011 providing little respite.

“Kingfisher needs better weather and an improved housing market if it is to see a stronger 2013.”

Published on Thursday 21 February by Editorial Assistant

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