DIY chain battles against tough UK market
Kingfisher this morning revealed a 32.6 per cent drop in pre-tax profits, with B&Q blamed for the collapse. Profits fell from£661.4 million to£445.7 million for the year ending January 28.

Sales at B&Q fell 3.7 per cent to£3.9 billion. Retail profit was down 52 per cent to£208.5 million because of a combination of lower sales, more aggressive price discounting, stock clearance and cost inflation. Like-for-like sales in the UK business - which also includes Screwfix Direct and Trade Depot - were down 6.3 per cent.

Group chief executive Gerry Murphy said: 'Strong performances in continental Europe and Asia were more than offset by a sharp downturn in home-related spending in the UK, presenting B&Q with its toughest trading environment.'

The group blamed the poor UK performance on a weakening home improvement market as well as a general downturn in consumer spending. Murphy said: 'With the important spring and summer season still to come, it is too early to forecast the full year, although a continuation of the recent stronger mortgage and housing trends could provide some support later in the year.'

Steve Davies of analyst Numis said: 'The drop in group profits was entirely because of B&Q, where profits halved during the year.'

Overall sales across the group were up 4.7 per cent, rising to£8.01 billion from£7.65 billion the previous year.

In the rest of Europe and Asia, sales were up 28 per cent for the year ending January 28, with 46 stores opening in eight countries.