Published on 25 - March - 2010
B&Q UK star performer in Kingfisher resultsGroup retail profit up 64.5% in 2009, with B&Q boosted by showroom sales and successful TradePoint trial.
Kingfisher UK and Ireland posted a sales increase of 1.2% to £4.4bn for the year to January 30, 2010. Retail profit was also up 64.5% for the period, with strong sales in DIY, while both the trade and Irish markets were described as challenging throughout the year.
B&Q UK and Ireland saw a 2.6% growth in sales to £4bn in 2009. Warmer weather boosted sales of outdoor products, which were up around 6%, while kitchen and bathroom sales were up around 7% as a result of greater investment in new ranges and showroom revamps, as well as competitor withdrawal form the market.
Sales of DIY and decorative products remained resilient, according to B&Q, down around 2%, with the drop in the housing market offset by renewed customer interests in DIY and low-cost room makeovers.
The DIY chain grew its retail profit for the year by 79.4% to £195m, with gross margin experiencing an increase of 110 basis points for the second year in a row.
B&Q continued in its bid to grow its share in the furniture and fitted kitchen and bathroom market, with showroom revamps in 105 of its stores. 4,000 of its employees have also graduated form the Showroom Academy, while a further 100 showroom revamps are planned for 2010/2011.
B&Q is also looking to expand its offer in to the trade market, with the successful trial of TradePoint stores in nine of its large UK branches. The 4,000 sq ft dedicated area has its own separate entrance, exit and payment area, with access restricted to TradePoint members who have been verified as genuine tradesmen.
There are currently 38 TradePoint stores in existence, including Edinburgh, Plymouth and Reading, with plans for a roll-out to a total of 118 B&Q stores.
Meanwhile Screwfix, faced with a challenging trade market, saw a 4.3% deline in sales to £471m - although this is fairly limited when compared with recent data that suggests the wider trade market has decline around 15%.
Screwfix opened nine new counters over the course of 2009, which, coupled with a decline in sales, resulted in a drop of £8m in retail profit to £22m.
Kingfisher group ceo Ian Cheshire commented: "I am pleased to report a strong improvement in performance...In generally weak consumer markets our self-help initiatives underpinned our robust performance, driving a higher gross margin, more cost efficiency and lower working capital.
"We have also been busy laying the foundations for our future growth by broadening our product range into new categories, opening new stores and coordinating our buying activities to enable more common sourcing.
He added: "Looking ahead, we remain cautious on the outlook for consumer demand across Europe. However, we are confident that our experienced management team, successful international strategy and buying scale mean we will be able to drive continued growth through our own actions. Recognising our improved profitability, cash generation and future growth prospects I am delighted that the final dividend payment will be increased, the first dividend growth for our shareholders in five years."
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