Kingfisher and Sports Direct showed both sides of the corporate governance coin this week.
On Monday afternoon, Kingfisher’s draft profit figures were accidentally circulated externally. The retailer immediately did the right thing and at 7am the next morning issued an RNS statement making public the profit rise originally scheduled for release next week. There is no evidence of any harm done.
Sports Direct meanwhile held its AGM on Wednesday and was once again under attack from watchdog Pirc for potentially excessive bonuses for top managers.
Sports Direct has been quite popular in the City lately, despite the massive upsets that followed its float. As the ads always say, past performance is no guide to future returns so perhaps its new-found favour in the Square Mile is justified.
But in an era when corporate reputation is so important, Kingfisher has shown itself to be transparent. And it doesn’t do any harm that its profits are going up.
Valued reminder of tough times
Department store group John Lewis’s decision to launch a value range and the BRC’s latest sales data both provide evidence that retailers can’t relax just yet.
As the anniversary of Lehman Brothers’ collapse approaches, the likelihood is that many stores will perform more strongly in the coming quarter on the back of weak comparatives. But no matter how welcome better numbers might be, they will not necessarily reflect the reality of consumer sentiment.
If John Lewis feels the need to bolster its value credentials then there are doubtless many others that will feel the same. The BRC 0.1% like-for-like sales slip is not the end of the world, nor a sign that performance is destined to fall further. But it is a reminder that, even though there are some signs of things getting better, happy days are not yet here again.
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