29th Sep 2020 08:59
(Alliance News) - B&M European Value Retail SA on Tuesday raised its earnings guidance as the discount retailer's knock-down prices and spacious stores were a hit among customers during the Covid-19 pandemic.
The discount retailer expects to report double-digit first-half revenue growth following its recent FTSE 100 promotion, adding that it will open about 40 new stores this year, shaking off a wider UK retail malaise.
B&M said its revenue in the six months to September 26, surged by just over 25% year-on-year, with its UK stores alone posting growth of 30%. In the second quarter alone, like-for-like growth in UK stores was 19%.
In addition, B&M raised its earnings guidance, with interim earnings before interest, tax, depreciation and amortisation expected to come in at GBP285 million, up from July's previously guided range of GBP250 million to GBP270 million.
"Our group has performed well in the first half. Our business model is proving well-attuned to the evolving needs of customers, given our combination of everyday value across a broad range of product categories being sold at convenient out-of-town locations," Chief Executive Simon Arora said.
Looking ahead, B&M expects 40 to 45 gross store openings before the end of the financial year, most of those scheduled in the fourth quarter. The move has given a vote of confidence to the embattled UK retail sector, which has struggled with declines in footfall and low consumer confidence, even before the Covid-19 pandemic gripped the market.
The Luxembourg-headquartered firm was bumped up to the FTSE 100 in the most recent index review.
Shares in the company were 3.1% higher at 505.40 pence each in London on Tuesday morning, the second-best blue-chip performer.
By Eric Cunha; [email protected]
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