Kingfisher Struggles in Early Trade

The FTSE 100 got off to a slow start this morning, while the big news of the day came from Kingfisher, the owner of B&Q. The retailer’s second quarter trading figures were weaker than expected, causing shares to fall by 3.1 percent.

UNDEFINED - Thursday, August 17, 2017

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Neil Wilson of ETX Capital said that there was “more of the same” from the company, and a massive outperformance from Screwfix hid what was otherwise a fairly poor set of numbers from the other companies in the group. He said that it could be time to ‘unscrew’ Screwfix from the other struggling parts of the group, and noted that it would be well-advised to spin-off the French division.

Many others have talked about options to save money for the group, and the idea that Screwfix would be better off if it was a standalone company is one that is often discussed. Common sourcing savings, however, could amount to £500 million per year by 2021 and may be one reason why the companies would not go down that route.

In the mid-caps, the big news of the morning was Hikma Pharmaceutical’s interim results, which failed to impress, and saw the company’s shares fall by almost nine percent.

Beyond that, the Sterling has received a small boost, as the Fed’s minutes revealed that US policymakers were split at the last meeting. This led to a sell-off of the dollar, boosting the pound back up to $1.29. A strong pound is usually bad news for FTSE 100 listed companies.


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