12th Nov 2019 08:41
(Alliance News) - Value retailing chain B&M European Value Retail SA held its interim dividend Tuesday amid sharply falling profit on the impairment of its German business, despite revenue growing strongly.
For the six months ended September 28, pretax profit fell by two-thirds to GBP32.2 million from GBP109.1 million the year prior. This was despite revenue rising 21% to GBP1.90 billion from GBP1.57 billion the year before.
Profit performance at the FTSE 250-listed firm was hurt by rising administrative costs and a GBP59.5 million impairment related to its Jawoll business in Germany.
"We have delivered a solid overall first half performance driven by our core B&M UK stores business which constitutes 86% of group sales," Chief Executive Officer Simon Arora said.
"Our existing stores performed consistently well through the last two quarters, generating half year like-for-like growth of 3.7%," Arora added. "The current crop of new stores also achieved especially strong results. The core business has made a solid start to the second half of the financial year."
"In Europe, we have seen contrasting performances from Babou in France and Jawoll in Germany," Arora said. "Babou has made good progress with the planned changes to its product offer. The performance of Jawoll has continued to be impacted by trading and operational issues and its financial performance remains disappointing. The board is carrying out a strategic review of Jawoll in order to determine its future."
B&M proposed a 2.7 pence per share interim dividend, unchanged on the year prior.
"We are well placed for the golden quarter in our main B&M UK stores business," Arora continued. "Despite the continued uncertainty in the economic environment generally, we are very proud to say that each of the top five store opening days in our history have all been in stores we have opened in the last 12 months."
Shares in Luxembourg-based B&M were 9.0% lower at 343.90 pence in London on Tuesday.
By Ahren Lester; [email protected]
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