DIY giant Kingfisher is prioritising making DIY easier for customers and continued global expansion as it approaches the next stage of its strategy under boss Ian Cheshire.
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The retailer’s UK B&Q stores are holding DIY masterclasses and it has launched a £6m ad campaign designed to tell consumers that B&Q can make home improvement easy.
Kingfisher group chief executive Cheshire said: “Home improvement is still perceived as difficult.”
He maintained that there was “spend waiting to come in to our market” if Kingfisher could coax consumers to approach DIY with confidence. “We’re very excited about unlocking this latent market,” he said.
The B&Q business in the UK and Republic of Ireland also intends to increase its store base from 330 to 350 as part of its five- to 10-year objective of faster growth and higher returns, which starts next year.
Kingfisher also wants to increase its international presence from 856 to 1,115 stores in its existing territories and intends to expand into new countries in the next five to 10 years.
The retailer revealed a 23% surge in adjusted pre-tax profit to £670m in the year to January 29. Group sales were flat at £10.5bn while like-for-likes slipped 0.9%.
Like-for-likes at B&Q UK and Republic of Ireland dropped 3.3% while total sales declined 2.8% to £3.9bn. However, retail profit rose 10.4% by £215m.
Cheshire said: “We have delivered another year of strong profit growth and cash generation in what continue to be challenging times.”
He said Kingfisher’s three-year Delivering Value initiative, which finishes at the end of this year when the new programme begins, has been a “success so far with profits almost doubled since it started”.
Cheshire said: “We are now better able to accelerate our expansion. Looking ahead, although I see no let up in the challenging environment in the short-term, I am excited by our future prospects.”
The retailer will renew its focus on multichannel and continue to innovate on product development. Group sourcing will be ramped up to create more common product.
Kingfisher France’s retail profit rose 7.8% to £348m. At the other international businesses - comprising Poland, China, Spain, Russia and Turkey - retail profits surged 34.3% to £171m.
Oriel Securities analyst Jonathan Pritchard said: “Management is certainly innovating and today’s plans and targets are credible. However, it will be a while before the UK consumer bounces back.”
Espirito Santo analyst Caroline Gulliver said: “Overall this is a reassuring set of results.”