B&M’s sales have dipped in the first quarter of the value retailer’s current financial year following exceptionally strong trading during the pandemic.
Group revenue grew by 3.1% to £1.18bn in the 13-week period from March 28 to June 26, a drop from the equivalent trading period in 2020 where sales grew by 27.7% to £1.15bn.
B&M store revenues rose to £1bn, increasing by 21.3% compared with pre-pandemic levels, but fell by 4.4% compared with Q1 2021.
The value retailer described trading patterns as “volatile” throughout the quarter, with the company reporting that strong demand for garden products in the final weeks of last year and the early weeks of the latest financial year has now slowed.
The company’s frozen food chain Heron Foods delivered a “satisfactory performance” with sales of £101.7m, while revenues at its French business Babou increased by 26.9% to £68.5m.
B&M opened seven new stores in Q1, closing four stores in the same period.
Chief executive Simon Arora said: “The group has made a strong start to the new financial year and sales remain significantly above pre-pandemic levels. As expected, trading throughout the first quarter was volatile as we annualised against the high comparatives from last year.”
The company also stated that it remains ”on track” to meet its plans for the year.
Arora added: “Although there remains much uncertainty as to how consumer spending evolves over the coming months, we remain optimistic that our combination of exceptional value across a wide range of product categories and our convenient out-of-town locations will continue to resonate with customers.
GlobalData senior retail analyst Amy Higginbotham said: “In B&M’s core UK business, like-for-like sales remain comfortably ahead of pre-pandemic levels, up 21.3% on Q1 FY2019/20. B&M’s French business, Babou, also returned to double-digit growth, albeit on a weak comparative.”
“However, this was not enough to satisfy investors, with B&M’s share price falling 2.8% in early-morning trading, after it flagged its uncertainty as to how consumer spending would evolve over the coming months and it did not provide a sales or profit outlook for the full year.”
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