B&Q owner Kingfisher revealed a 16% slump in profits at the home improvement retail outlets today as it warned that trading conditions had remained “challenging” in recent weeks.
The company, which is Europe’s biggest home improvement retailer, highlighted the dire position of its market with quarterly figures showing a 7.7% fall in like-for-like sales at B&Q in the three months to April 30.
The disappointing first quarter performance had been expected following an update last month, although Kingfisher did little to signal an improvement today when it said current trends continued to be “adverse”.
It blamed strong competition, the impact of weaker consumer demand and an early Easter period for poor sales of kitchens, bedrooms and bathrooms. Trade-related business performed the best over the first quarter, it added.
Chief executive Gerry Murphy said: “So far, 2005 has been difficult for retailers, with consumer spending clearly impacted by higher interest rates, higher taxes and pension contributions, and rising fuel bills.”
He added: “With the key summer season still to come, it is too early judge the outlook for the full year. However, trading in the first three weeks of our second quarter continues to be challenging in the UK and France.”
As well as B&Q in Ireland and the Uk and Screwfix Direct in the UK, Kingfisher owns Castorama and Brico Depot in France and stores across Europe and Asia.
Across the group, total sales were up 2.2% at £1.94bn (€2.8bn), but down 5.6% when new store openings are stripped out of the figures. As indicated in April, retail profits were down almost 16%, at £125.9m (€183m).
B&Q’s total sales declined 2.8% to £1bn (€1.4bn) with retail profits down 16.5% at £73.2m (€106m).
Despite the fall, Kingfisher said it believed it had maintained market share during the period. In France, profits were 7.4% lower at £40.2m (€58.4m).