Business

B&Q owner Kingfisher upbeat despite 'challenging year'

  • 25 March 2014
  • From the section Business
Screwfix Image copyright PA
Image caption Kingfisher said it expected to return around £200m to shareholders in the coming year

Kingfisher, the owner of DIY chains B&Q and Screwfix, has said it has finished a "challenging year" in "good shape".

Group profits rose 9.8% to £759m in 2013, despite an "extremely challenging" first quarter, and a disappointing third quarter.

In the UK and Ireland B&Q's total sales rose slightly, to £3.6bn, with Screwfix total sales up 17.6% to £665m.

Kingfisher said prospects for the year to come were "bright" and it would return £200m to shareholders this year.

'Confidence'

The company said its performance had improved thanks to a combination of pricing, marketing, an expanded product range, and upgrades to its websites.

"Our prospects remain bright, giving us confidence to invest in the business and actively manage our portfolio," said chief executive Sir Ian Cheshire.

Kingfisher's most significant market is France where the economic backdrop "was generally soft", in line with the rest of Europe.

Kingfisher owns Brico Depot and Castorama in France, where sales were £4.4bn.

Generally weak consumer confidence in France was reflected by a drop in like-for-like sales of 1.2%.

The company also said it intended to look for a strategic partner for B&Q China this year, and had already had expressions of interest.

Shares were up almost 5% in early trading on Tuesday after the results were published.

"The early share price spike is in reaction to better than expected profit numbers, accompanied by robust growth in key metrics such as earnings per share and a continuation of Kingfisher's progressive dividend policy," said Richard Hunter, head of equities at Hargreaves Lansdown Stockbrokers.

"The company is running a tight ship and even before today's reaction, the share price had risen 41% over the last year, as compared to a 2% improvement for the wider FTSE 100," he added.

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