Kingfisher’s share price slumped on Monday, as ongoing sales weakness forced the FTSE 100 retailer cut its full-year profit guidance.
At 257.1p per share, Kingfisher was last dealing 12.8% lower in start-of-week business.
For the financial year ending January 2025, the business now expects pre-tax profit to be between £510 million and £540 million. This is down from previous guidance of £510 million to £550 million.
At group level, like-for-like sales dropped 1.1% in the three months to October, to £3.2 billion. On a reported basis, turnover was down 0.6% year on year.
UK and Irish Sales Climb
In its largest market of UK and Ireland, Kingfisher sales rose 1.2% on a reported basis, to £1.6 billion. Meanwhile, like-for-like sales were up 0.4% from the same 2023 period.
Growth was driven by the firm’s Screwfix unit, where reported and like-for-like sales rose 4.6% and 1.8% respectively.
Screwfix’s solid performance was thanks to “robust demand from trade customers supporting positive like-for-like sales and volume growth in core categories,” the company said.
… But Sales Slump In France
However, sales in France continued to fall sharply “due to weak consumer sentiment and adverse weather,” Kingfisher said.
Reported sales were down 6.4%, while on a like-for-like basis revenues slipped 4.3%.
Kingfisher said that “continued weakness in the broader market… was compounded in October by the release of the draft Finance Bill for 2025, which weighed on consumer sentiment, together with wetter and milder than normal weather.”
France’s latest Finance Bill proposes a raft of tax hikes along with fresh austerity measures.
In its other markets, Kingfisher’s reported sales rose 4.7% during quarter three. On a like-for-like basis revenues increased 0.5%
Uncertainty Increases
Describing overall trading in the last quarter as “resilient,” chief executive Thierry Garnier said that “improved performance in August and September was offset by the impact of increased consumer uncertainty in the UK and France in October, related to government budgets in both countries.”
He noted that “looking towards next year, recent political and macroeconomic developments have layered incremental uncertainty onto the near-term outlook in our markets.
Garner added that “[therefore] we continue to focus our energy on what we can control – delivering further market share gains through our key strategic priorities, and managing our retail prices, costs and cash effectively.”
As well as impacting sales, Kingfisher said that tax changes in the UK and France outlined in recent budgets would push related costs up by £45 million in financial 2026.
UK and French tax costs are tipped to increase £31 million and £14 million respectively.
For the current quarter, Kingfisher said that trading “has started with an improvement versus the exit rate from quarter three.”
It said that like-for-like sales were down 0.5% for the three weeks to 23 November.
Hammer Blow
Describing Kingfisher’s update as “shaky,” eToro analyst Mark Crouch noted that “the impact of Rachel Reeves’ recent budget may have dealt a significant hammer blow for the B&Q owner.”
For the third quarter, he said that “Screwfix held up relatively well helping to offset some of the broader difficulties, posting modest sales growth.”
However, he added that “performance in France remains a concern, with sales continuing to fall. What first might have felt like a splinter at the start of the year for Kingfisher could develop into something worse if the current trends there don’t reverse.”
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