TIDMKGF
RNS Number : 8867S
Kingfisher PLC
19 November 2021
Q3 trading update to 31 October 2021
Sales of GBP3.2 billion; LFL(1) down 2.4% and 2-year LFL(2) up
15.0%
19 November 2021: Kingfisher plc ('Company', 'Group' or
'Kingfisher') is today providing its Q3 21/22 sales.
Key points
-- Strong sales performance from all banners and categories on a
2-year basis, across both retail and trade channels
-- Continued market share gains, driven by ongoing delivery against strategic priorities
-- Effective management of product availability, logistics and inflation pressures
-- Good start to the fourth quarter
-- Expect H2 21/22 LFL sales and full year adjusted pre-tax
profit to be towards the higher end of previously guided ranges
-- Strategic execution and supportive new industry trends
provide opportunity for sustained long-term growth
-- Commenced GBP300 million share buyback programme; c.GBP67 million completed so far
Unaudited Q3 21/22 sales (three months ended 31 October
2021)
Sales % Total % Total % LFL % 2-year LFL
2021/22 Change Change Change Change
--------------------------------- --------- --------- ------------------ ------------------ ------------------
GBPm Reported Constant currency Constant currency Constant currency
UK & Ireland 1,544 (2.1)% (1.9)% (3.5)% +15.7%
- B&Q 962 (5.3)% (5.2)% (5.6)% +17.1%
- Screwfix 582 +3.9% +4.0% +0.2% +13.0%
France 1,111 (9.5)% (4.1)% (4.3)% +14.1%
- Castorama 570 (12.0)% (6.8)% (6.1)% +15.7%
- Brico Dépôt 541 (6.7)% (1.0)% (2.3)% +12.4%
Other International (ex-Russia) 591 +1.2% +9.3% +5.3% +15.3%
- Poland 420 +1.4% +10.0% +4.9% +12.7%
- Iberia(3) 89 (7.3)% (1.9)% (1.9)% +15.9%
- Romania(4) 78 +6.4% +14.6% +17.2% +29.2%
- Other(5) 4 n/a n/a n/a n/a
Total Group (ex-Russia) 3,246 (4.2)% (0.8)% (2.4)% +15.0%
--------------------------------- --------- --------- ------------------ ------------------ ------------------
- Russia(6) - (100.0)% (100.0)% n/a n/a
Total Group 3,246 (6.3)% (3.0)% (2.4)% +15.0%
--------------------------------- --------- --------- ------------------ ------------------ ------------------
-- Strong trading performance (2-year LFL up 15.0%), with growth
in footfall and average transaction value
-- Resilient demand against very strong prior year comparatives;
total sales (ex-Russia) down 0.8% in constant currency (LFL sales
down 2.4%)
-- Omni-channel engagement remains high with e-commerce sales(7)
2-year growth of 133%; now 16% of Group sales
-- Strong momentum has continued into the fourth quarter; Q4
21/22 LFL sales (to 13 November) (8) on a 2-year basis up 13.2% (
LFL up 0.4 %)
Thierry Garnier, Chief Executive Officer, said:
"Kingfisher has delivered another successful quarter, with
2-year LFL sales growth of 15% and strong growth across both retail
and trade channels, and across all categories. These are even
stronger sales trends given the backdrop of an increasingly
'normalised' consumer spending environment. Demand remains
supported by what we believe are enduring new industry trends,
including more working from home.
"We continue to grow our market share, driven by strong
execution of our new strategy. We are pushing forward with
investments in key areas of the business to drive long-term growth,
including further enhancements to our e-commerce proposition and
Screwfix's launch in France. And we are progressing with our clear
plans to deliver on our carbon reduction targets, aligned to
1.5degC to 2025, and to become 'forest positive' by the same
year.
"Since the start of this year we have maintained, and in many
cases improved, our product availability, which is amongst the best
in our industry. This has supported our market share gains and
allowed us to upweight promotional initiatives in the quarter. We
have also continued to manage inflation pressures effectively,
while retaining highly competitive pricing.
"We have entered our final quarter with positive momentum and
now expect sales and profits to be towards the higher end of our
previously guided ranges. Overall, with strong execution and
supportive new long-term trends for our industry, we remain
confident of continued outperformance of our markets."
Current trading and outlook
The following guidance applies in the event of no adverse change
in COVID-related measures (e.g. new lockdown restrictions resulting
in store or showroom closures, or restrictions on entry to stores
depending on vaccination status):
-- Good start to the fourth quarter, with Q4 21/22 LFL sales (to
13 November) on a 2-year basis up 13.2 % ( LFL sales up 0.4 %)
-- H2 21/22 LFL sales: expect to be towards the higher end of
our previously guided range (-7% to -3%; corresponding 2-year LFLs
of +9% to +13%)
-- Full year adjusted pre-tax profit: expect to be towards the
higher end of our previously guided range (GBP910 million to GBP950
million)
Q3 highlights
Climate change
We continue to deliver against our science-based carbon
reduction targets to 2025, which are consistent with reductions
required to keep global warming to 1.5degC. Our targets were
approved by the Science Based Targets Initiative (SBTi) in June
2021, placing Kingfisher among a very small number of retailers
worldwide to have such a commitment.
Through our partnership with the UN's 'Race to Zero Retail
Breakthroughs', we participated at the UN Climate Change Conference
(COP26) alongside other leading retailers, to share good practices
to support more retailers worldwide to take action.
Our targets build on the significant progress being made to cut
the environmental footprint of our retail banners and products.
Highlights include:
-- B&Q, Screwfix, Castorama France, Brico Dépôt France and
Brico Dépôt Iberia all now purchasing 100% low-carbon
electricity;
-- A score of 'A-' in the latest CDP Climate Change disclosure initiative;
-- Maintaining our 'AAA' rating from the MSCI; and
-- B&Q, as the UK's largest garden centre, working to
deliver '100% peat-free' across all compost in 2023.
In addition, in June 2020 we made a new commitment to be forest
positive, through 'creating more forests than we use', by 2025.
Alongside our commitment to ensure all our wood and paper is
responsibly sourced by FY 25/26, we are also a founding member of
the Rainforest Alliance's 'Forest Allies' initiative, investing in
significant reforestation and community forest projects in
Indonesia, Peru, Colombia, Guatemala and Cameroon.
Operational status
Kingfisher remains committed to meeting the needs of our
customers safely, and ensuring colleague safety and wellness.
COVID-related safety measures remain in place in all our stores and
locations.
All stores remain open across the Kingfisher Group. In Romania,
national restrictions were imposed on 25 October 2021 to limit
access to retail stores (except standalone food stores, pharmacies
and petrol stations) to customers who can prove (via health
certificates) their double-vaccination status or recovery from the
virus. As of 16 November 2021, around 35 % of the Romanian
population is double-vaccinated. The current restrictions are
expected to apply at least until the beginning of December 2021.
Romania's Q4 21/22 LFL sales to (13 November)(4) are down 11.8%
(2-year LFL up 3.9%).
Trading highlights (in constant currencies)
UK & IRELAND
Total sales -1.9% (LFL - 3.5%; 2-year LFL + 15.7%). Continuing
to grow sales ahead of the market with strong engagement from new
and existing customers.
-- B&Q sales -5.2%. LFL - 5.6% (2-year LFL + 17.1%)
reflecting resilient demand against the backdrop of very strong
prior year comparatives.
- Strong 2-year performance in outdoor, building & joinery and kitchen categories.
- LFL sales of weather-related categories were down 12% (up 28%
on a 2-year LFL basis). LFL sales of non-weather-related
categories, including showroom, were down 4% (up 14% on a 2-year
LFL basis).
- TradePoint , B&Q's trade-focused banner, continued to
outperform, with LFL sales up 5% and 2-year LFL sales up 27%.
TradePoint sales were 22% of B&Q sales in Q3.
- B&Q's new own exclusive brand (OEB) kitchen range
continues to perform well in H2, with a healthy order-book of sales
and good take-up of installation services.
- Opened two new stores in Q3, including one compact store and
one further store-in-store concession (within an ASDA
supermarket).
-- Screwfix sales +4.0%. LFL +0.2% (2-year LFL +13.0%)
reflecting continued strong demand from trade customers.
- During the period, we continued to roll out Screwfix 'Sprint',
with strong early results. 'Sprint' offers customers an
industry-leading 60-minute home delivery service (average delivery
time c.45 minutes), currently covering one third of the UK
population.
- Opened 11 new stores in Q3 in the UK and Republic of Ireland.
FRANCE
Total sales -4.1% (LFL - 4.3%; 2-year LFL +14.1%). France
continues to grow sales ahead of the market in Q3, driven by strong
performances at both banners, with an outperformance of nearly 3
percentage points on a 2-year basis. LFL sales for the home
improvement market (as measured by Banque de France data(9) ) in Q3
were +11.3% on a 2-year basis.
-- Castorama sales -6.8%. LFL -6.1% (2-year LFL +15.7%)
reflecting resilient demand against the backdrop of very strong
prior year comparatives.
- Strong 2-year performance in outdoor, building & joinery and kitchen categories.
- LFL sales of weather-related categories were down 6% (up 27%
on a 2-year LFL basis). LFL sales of non-weather-related
categories, including showroom, were down 7% (up 14% on a 2-year
LFL basis).
-- Brico Dépôt sales -1.0%. LFL - 2.3% (2-year LFL + 12.4%),
reflecting continued focus on strengthening its discounter
credentials and differentiated ranges.
- Strong 2-year performance in building & joinery and outdoor categories.
OTHER INTERNATIONAL
-- Poland sales +10.0%. LFL +4.9% (2-year LFL +12.7%).
- Strong 2-year performance in all categories, in particular the new OEB kitchen range.
- LFL sales of weather-related categories were up 6% (up 19% on
a 2-year LFL basis). LFL sales of non-weather-related categories,
including showroom, were up 4% (up 12% on a 2-year LFL basis).
- Opened two new stores in Q3, including one medium-box and one compact store.
-- Iberia sales -1.9%. LFL - 1.9% (2-year LFL + 15.9%), with
resilient demand against strong prior year comparatives.
-- Romania sales +14.6% (4) . LFL + 17.2% (2-year LFL +29.2%)
reflecting strong demand, in particular across the EPHC
(electricals, plumbing, heating & cooling), outdoor and
building & joinery categories . Please refer to the
'Operational status' section above for details of COVID-related
restrictions recently imposed in Romania.
Footnotes
(1) LFL (like-for-like) sales growth represents the constant
currency, year on year sales growth for stores that have been open
for more than one year. Stores temporarily closed or otherwise
impacted due to COVID are also included.
(2) 2-year LFL is calculated by compounding current and prior
year LFL growth. For example, current year LFL growth of 10% and
prior year LFL growth of 5% results in 2-year LFL growth of 15.5%.
Prior year LFL growth excludes Russia for the purposes of the Group
and Other International 2-year LFL calculations.
(3) Brico Dépôt Spain and Portugal.
(4) Kingfisher's subsidiary in Romania has historically prepared
its financial statements to 31 December. In FY 21/22, Romania is
migrating to Kingfisher's financial reporting calendar (year ending
31 January 2022). Its Q1 21/22 sales therefore included one
additional month of results (April 2021) in order to facilitate the
alignment to Kingfisher's financial reporting calendar. Its Q3
21/22 sales presented are for August to October 2021, with the
reported and constant currency variances comparing against July to
September 2020. LFL, 2-year LFL, and Q4 21/22 LFL (to 13 November)
sales growth for Romania compares equivalent periods in current and
prior years. Romania's LFL sales growth in the month of January
2021 was 22.2%.
(5) 'Other' consists of the consolidated results of NeedHelp
(acquired in November 2020), Screwfix International (launched
online in France in April 2021), and revenue from franchise
agreements.
(6) The Group completed the sale of Castorama Russia on 30
September 2020.
(7) E-commerce sales are total sales derived from online
transactions, including click & collect. This includes sales
transacted on any device, however not sales through a call centre.
E-commerce sales change is in constant currency and covers the
total Group, excluding Russia.
(8) 'Q4 21/22 LFL sales (to 13 November)' represents the period
from 31 October 2021 to 13 November 2021 (compared against the
equivalent period in the prior year, from 1 November 2020 to 14
November 2020). The corresponding 2-year LFL represents the period
from 31 October 2021 to 13 November 2021 compared against the
equivalent period in FY 19/20 (i.e. from 3 November 2019 to 16
November 2019). The figures are provisional and exclude certain
non-cash accounting adjustments relating to revenue
recognition.
(9) Banque de France data for DIY retail like-for-like sales
(non-seasonally adjusted). Includes relocated and extended stores
http://webstat.banque-france.fr/en/browse.do?node=5384326 .
Contacts
Tel: Email:
Investor Relations +44 (0) 20 7644 investorenquiries@kingfisher.com
1082
Media Relations +44 (0) 20 7644 corpcomms@kingfisher.com
1030
Teneo +44 (0) 20 7420 Kfteam@teneo.com
3184
Q3 trading update and data tables
This announcement and data tables for Q3 21/22 sales can be
downloaded from www.kingfisher.com/investors .
We can be followed on Twitter (@kingfisherplc) with the Q3
results tag #KGFQ3.
Full year 21/22 results
Our next scheduled announcement will be our results for the year
ending 31 January 2022, on 22 March 2022.
American Depository Receipts
Kingfisher American Depository Receipts are traded in the US on
the OTCQX platform: (OTCQX: KGFHY)
http://www.otcmarkets.com/stock/KGFHY/quote .
About Kingfisher plc
Kingfisher plc is an international home improvement company with
approximately 1,430 stores, supported by a team of over 81,000
colleagues. We operate in eight countries across Europe under
retail banners including B&Q, Castorama, Brico Dépôt, Screwfix,
TradePoint and Koçta . We offer home improvement products and
services to consumers and trade professionals who shop in our
stores and via our e-commerce channels. At Kingfisher, our purpose
is to help make better homes accessible for everyone.
Forward-looking statements
You are not to construe the content of this announcement as
investment, legal or tax advice and you should make your own
evaluation of the Company and the market. If you are in any doubt
about the contents of this announcement or the action you should
take, you should consult a person authorised under the Financial
Services and Markets Act 2000 (as amended) (or if you are a person
outside the UK, otherwise duly qualified in your jurisdiction).
This announcement has been prepared in relation to sales for the
quarter ended 31 October 2021. The financial information referenced
in this announcement is not audited and does not contain sufficient
detail to allow a full understanding of the results of the Group.
Nothing in this announcement should be construed as either an offer
or invitation to sell or any offering of securities or any
invitation or inducement to any person to underwrite, subscribe for
or otherwise acquire securities in any company within the Group or
an invitation or inducement to engage in investment activity under
section 21 of the Financial Services and Markets Act 2000 (as
amended).
Certain information contained in this announcement may
constitute "forward-looking statements" (including within the
meaning of the safe harbour provisions of the United States Private
Securities Litigation Reform Act of 1995), which can be identified
by the use of terms such as "may", "will", "would", "could",
"should", "expect", "anticipate", "project", "estimate", "intend",
"continue", "target", "plan", "goal", "aim", "forecast" or
"believe" (or the negatives thereof) or other variations thereon or
comparable terminology. These forward-looking statements include
all matters that are not historical facts and speak only as of the
date on which they are made and include statements regarding the
Company's intentions, beliefs or current expectations and those of
our Officers, Directors and employees concerning, amongst other
things, the Company's results of operations, financial condition,
changes in global or regional trade conditions, changes in tax
rates, exchange rates or interest rates, changes to customer
preferences, liquidity, prospects, growth and strategies, acts of
war or terrorism worldwide, work stoppages, slowdowns or strikes,
public health crises, outbreaks of contagious disease (including
but not limited to the COVID pandemic), environmental disruption or
political volatility. By their nature, forward-looking statements
involve inherent risks, assumptions and uncertainties that could
cause actual events or results or actual performance of the Company
to differ materially from those reflected or contemplated in such
forward-looking statements. For further information regarding risks
to Kingfisher's business, please consult the risk management
section of the Company's Annual Report (as published). No
representation or warranty is made as to the achievement or
reasonableness of, and no reliance should be placed on, such
forward-looking statements.
The Company does not undertake any obligation to update or
revise any forward-looking statement to reflect any new
information, change in circumstances, or change in the Company's
expectations.
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