Published on 31 - May - 2012
B&Q LfL sales down 11.7% for Q1, but Screwfix flourishesBad weather was blamed for B&Q's dip in sales during the 13 weeks to April 28, falling 8.9% to £968million, a downward slide of more than 11% compared with this time last year.
The DIY retail giant saw a sales decline
The news came as parent group Kingfisher Plc announced a drop of 9.8% for its UK retail profit over the period. It was better news for Screwfix, however, which saw growth of 10.2% bringing its total sales to £137m, boosted by the introduction of its new 'DIY Express' outlets.
Screwfix's strong performance was also attributed to the roll out of new ranges including radiators and work wear, and a boost to the retailer's multi-channel offering in the form of its mobile 'click, pay and collect' service. Retail profit was up 31.7% to £11m.
At B&Q, meanwhile, sales of outdoor seasonal products were down an estimated 30% due to poor weather, which also affected sales of building products. On the other hand, cash sales of kitchen, bedroom and bathroom products were up slightly. Bosses pointed out that the year had started with "a lower order balance following the introduction of Every Day Low Prices (EDLP) in Q4 2011, resulting in recognised sales in the quarter being down compared with last year."
Sales of indoor decorative products at B&Q were reportedly up in reflection of consumers opting to spend more time on interior home improvements. Retail profit slid by 13.8% to £65m, with margin and cost initiatives unable to fully offset the impact of the sharp year on year fall in seasonal sales. Gross margins were up 120 basis points, reflecting better sales of higher margin products, fewer promotions and increased direct sourcing.
Total sales for the entire Kingfisher group, which includes European businesses Castorama and Brico Depot, were down 3.6%, with retail profit declining by 8.6%. As well as the weather, adverse foreign currency translation was also pinpointed as a reason for the slide.
Kingfisher chief executive Ian Cheshire said: "We anticipated the first quarter would be challenging, compared with last year's strong growth which was boosted by favourable spring weather and public holidays. But an extremely wet April this year in the UK and France compounded the difficulty, adversely impacting sales of outdoor and seasonal categories.
"Given this unfavourable backdrop, we focused hard on our margin and cost initiatives and were able to significantly limit the profit impact. With the first quarter typically one of the least significant of the year and with the key summer season still ahead of us, we remain confident that we are well prepared to capitalise on any improvement in conditions and deliver a solid full year result.
"We are also making progress with our new programme of self-help initiatives, 'Creating the Leader', aimed at helping our customers have better, more sustainable homes and building a more valuable business for our shareholders."
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