Home improvement retailer B&Q has reported a growth in like-for-like sales as overall UK and Ireland revenues rose.
According to the latest Kingfisher, parent company of B&Q, trading update, Q3 sales for UK and Ireland rose 3.3% to £1.5bn against the same period last year.
B&Q sales were up 1% to £946m, with like-for-like sales increasing by 1.1%, with resilient retail trends outpaced by trade sales.
“The business saw good performances in surfaces & décor, tools & hardware and outdoor categories in the quarter, offsetting a slower start to autumn and winter product sales,” the group said. “B&Q’s total e-commerce sales increased by 31.8% YoY, with an overall e-commerce sales penetration of 12.9% (Q3 22/23: 10.1%), driven by the further scaling of B&Q’s e-commerce marketplace, which reached a participation of 35% in October (i.e., B&Q’s marketplace gross sales divided by B&Q’s total e-commerce sales). Marketplace gross merchandise value (GMV) increased by over 290% YoY.
“B&Q opened one new store in Q3 (a B&Q Local compact format in Sutton). TradePoint, B&Q’s trade-focused banner, outpaced retail sales in the quarter with LFL sales of +3.1%, reaching a penetration of 23% of B&Q’s total sales (Q3 22/23: 23%). The banner continues to successfully strengthen its product and services proposition for trade customers, including trade-only deals and events. Customer engagement and loyalty also continues to strengthen, with membership sign-ups growing YoY.”
Overall, Kingfisher group sales were down 2.1% to £3.2bn. Full year adjusted profit guidance has been lowered to c.£560m to reflect continuation of Q3 trends in Q4, including continued resilience in the UK and market weakness in France, with the group now expecting full year free cash flow of c.£470m.
Thierry Garnier, Chief Executive Officer, said: “Our UK banners performed well in Q3, with B&Q, TradePoint and Screwfix growing sales and market share. In France, our performance was impacted by a weak retail market, as well as a delayed start to insulation, plumbing and heating sales – to which Brico Dépôt is more heavily weighted – due to unusually warm autumn weather, and strong prior year comparatives in these categories. In Poland we are seeing early signs of recovery in the trading trend, against an incrementally more positive consumer and economic backdrop. Reflecting the weakness of the French market, and notwithstanding our proactive cost actions, we have lowered our Group profit guidance for the full year.
“We continue to focus on our execution and driving our strategy forward. Our online marketplaces are growing rapidly, with B&Q’s marketplace reaching 35% of its e-commerce sales in October. Screwfix has continued its international expansion, by launching as a pure-play online retailer in six new European countries, and opening four new stores in France in the quarter. We also continue to harness AI and data to support sales, profit and cash, including by growing our retail media proposition across the Group.
“As we move into 2024, we are focused on what is in our control. First, a continued focus on growing market share in the UK, France and Poland with delivery of our strategic growth initiatives. Second, driving productivity gains to offset wage inflation. And finally, delivering on our free cash flow and shareholder returns targets. We expect to see some product cost price inflation, albeit at a significantly lower level, and expect rational retail pricing and competitive price indices at all our banners.
“On the medium-to-longer term outlook, we remain very positive for home improvement growth in our markets, and our ability to grow ahead of our markets.”
