Same old story for Kingfisher

Same old story for Kingfisher with today’s Q1 trading update showing a strong performance in the UK offset by some weaker performance in France. Investors are less than impressed with the stock diving more than 6% in early trading. Overall LFL sales for Kingfisher were 0.6% lower, which is down to the soggy French business and the disruptive effects of Veronique Laury’s turnaround strategy.

Screwfix remains the standout performer — delivering a 12.6% rise in like-for-like sales in constant currency. This remains a positive story in terms of UK plc too as the trade-focused brand’s performance depends on builders, plumbers and electricians being busy. Total sales at Screwfix were up by a fifth.

DIYers are not so active — with sales at B&Q down more than 4% overall. However LFL were not so bad, rising half a percent.

France is a sore point, with LFL sales in a constant currency basis down 5.5%. Castorama and Brico Depot considerably underperformed and as previously stated Kingfisher may consider offloading its French business if it continues to degrade shareholder value and act as a drag on the strong UK business much longer. Total sales were up 3.8%, but on a constant currency basis total sales were down 5%.

Neil Wilson

Senior Market Analyst

ETX Capital