29th Nov 2007 07:01
Kingfisher PLC29 November 2007 EMBARGOED UNTIL 0700 HOURS Thursday 29 November 2007 Kingfisher plc Q3 trading update for the 13 weeks ended 3 November 2007 Group Financial Summary Retail Retail Sales (1) Profit (2) % Total % Total % LFL % Total % Total 2007/08 Change Change Change 2007/08 Change Change £m (Reported) (Constant £m (Reported) (Constant currency) currency)UK (3) 1,085.4 3.5% 3.5% (0.5)% 45.3 (11.9)% (11.9)% France (4) 856.1 7.2% 5.6% 2.3% 89.3 16.6% 15.5% Rest of Europe (5) 345.0 22.9% 18.6% 10.1% 41.7 0.7% (2.1)% Asia (6) 122.7 6.1% 8.6% 0.4% (4.6) n/a n/aInternational 1,323.8 10.8% 9.0% 4.1% 126.4 3.9% 2.3%Total 2,409.2 7.4% 6.4% 1.9% 171.7 (0.8)% (1.9)% (1) Joint Venture (JV) and Associate sales are not consolidated.(2) Retail profit is stated before central costs, exceptional items, acquisition intangibles amortisation and share of joint venture and associate interest and tax.(3) B&Q, Screwfix and Trade Depot.(4) Castorama and Brico Depot.(5) Rest of Europe includes Poland, Italy, Spain, Ireland, Russia, Turkey JV and Hornbach in Germany.(6) Asia includes China, South Korea and Taiwan JV. • Group sales up 6.4% (LFL+1.9%), retail profit down 1.9%;• B&Q UK sales up 0.8% (LFL -0.2%). B&Q's renewal programme gathered pace, a further eight large stores were revamped and new decorative ranges successfully launched. Profits were down reflecting higher revamp activity and an accelerated pace of range renewal;• French sales up 5.6% (LFL +2.3%), profits ahead 15.5% as gross margins benefited from higher sales of own brands;• Rest of Europe sales up 18.6% (LFL+10.1%), another strong performance in Poland;• Asia sales up 8.6% (LFL +0.4%), a slowdown of new apartment sales in the major Chinese markets impacted B&Q's installation sales. Losses reflect the regulatory changes highlighted at the interims;• Net debt at 3 November 2007 of £1.4 billion (3 February 2007: £1.3 billion);• Net assets at 3 November 2007 of £4.6 billion (3 February 2007: £4.4 billion). Peter Jackson, Group Chairman, said: "In aggregate our international businesses, which account for more than half ofKingfisher's sales, again delivered positive sales and profit growth driven byparticularly good performances in France and Poland. "In the UK, where consumer demand is widely anticipated to soften further overthe coming months, B&Q's renewal is progressing well, with the new ranges andrevamped stores showing that a compelling offer in the right store environmentwill continue to attract customers." UK Retail sales £m 2007/08 2006/07 Reported % LFL % Change ChangeUK 1,085.4 1,049.2 3.5% (0.5)% Retail profit £m 2007/08 2006/07 Reported % ChangeUK 45.3 51.4 (11.9)% UK includes B&Q in the UK, Screwfix and Trade Depot. Due to the 53rd week in UK reporting for 2006/07, the Reported Change % abovecompares 13 weeks ended 3 November 2007 with 13 weeks ended 28 October 2006 asreported in 2006/07. On this basis B&Q LFL was -0.7%.However, for better alignment, the actual reported change in LFL sales of -0.2%compares 13 weeks ended 3 November 2007 to 13 weeks ended 4 November 2006. B&Q aims to grow its share of home improvement expenditure by strengthening itsappeal to both the Do-It-Yourself (DIY) and Do-it-For-Me (DFM) customer. DuringQ3 B&Q progressed with its renewal programme, which includes improving its storeenvironments, updating product ranges and introducing more services, supportedby a major new advertising campaign which has been well received. Total sales increased 0.8% to £961.9 million (-0.2% LFL). Good sales growth fromrevamped large stores and new ranges helped offset disruption from the ongoingrenewal activity. Results from the new format large stores continued to be encouraging and afurther eight large stores were revamped in Q3 taking the total trading in thenew format to 31. The net impact, after the benefit from improved trading fromstores revamped earlier in the year, was £2 million in the quarter. In addition,six medium stores were revamped and one large store was downsized. B&Q now has116 large stores (31 in the modern format) and 208 medium stores (of which 142have been modernised). Recently updated decorative ranges performed well and activity to updatebuilding, hardware, bedroom and flooring ranges accelerated in Q3, withclearance activity impacting margins by £12 million. B&Q has now updated around45% of its ranges so far this year and is on track to achieve its target of 60%by the end of the year. Retail profit was £37.8 million (2006/07: £46.6 million) after the £14 millionrenewal costs mentioned above. The underlying gross margin percentage beforeclearance activity was flat. Costs were only slightly up, with cost savingsoffsetting inflation, new space and additional large store revamp activity. Forthe full year, costs are now expected to increase by 4%, down from previousestimates of 6%. Screwfix sales grew 28.1% to £117.1 million, driven by increased customernumbers and higher average order values compared to last year. These were drivenby an expanded catalogue and the continued roll-out of the new trade counters,providing customers with immediate product availability. An additional 12outlets opened during the quarter, taking the total to 80. A further 13 areplanned in Q4. Retail profit increased 30.8%, reflecting the increased sales anddistribution productivity gains offset by trade counter opening costs. Thesecond distribution centre, commissioned to support the trade counter roll-out,remains on target to be fully operational by the end of the year. FRANCE Retail sales £m 2007/08 2006/07 % Change % Change % LFL (Reported) (Constant) ChangeFrance 856.1 798.3 7.2% 5.6% 2.3% Retail profit £m 2007/08 2006/07 % Change % Change (Reported) (Constant)France 89.3 76.6 16.6% 15.5% France includes Castorama and Brico Depot.2007/08 £1 =1.4705 euro (2006/07 £1 = 1.4642 euro)All percentage movements below are in constant currencies. In France, Kingfisher's total sales grew 5.6% to £856.1 million (+2.3% LFL).Banque de France data shows that growth in comparable DIY store sales* wasaround 2.8%, and on this same basis Kingfisher's businesses delivered comparablesales growth of 2.9%. Retail profit of £89.3 million grew 15.5% compared to the same period last year,with both businesses delivering profit growth. Gross margins were up 90 basispoints due to higher own-brand sales penetration and an improved sales mixacross both businesses. *Banque de France data including relocated and extended stores Castorama total reported sales grew by 3.8% to £450.5 million (+4.8% LFL, +5.7%on a comparable store basis) with bathroom, flooring and decorative rangesperforming well. One more store was revamped during the third quarter,completing the revitalisation programme for the year. Stores trading in the newformat, representing 42% of total selling space, continue to outperform. Brico Depot sales grew 7.6% to £405.6 million (-0.3% LFL), reflecting growth instore numbers, offset by internal cannibalisation of around 2% following theopening of new stores over the last 12 months in catchments where existingstores were trading at full capacity. One new store opened during Q3, completingthe opening programme for the year. REST OF EUROPE Retail sales £m 2007/08 2006/07 % Change % Change % LFL (Reported) (Constant) ChangeRest of Europe 345.0 280.7 22.9% 18.6% 10.1% Retail profit £m 2007/08 2006/07 % Change % Change (Reported) (Constant)Rest of Europe 41.7 41.4 0.7% (2.1)% Rest of Europe includes Poland, Italy, Spain, Ireland, Russia, Turkey JV andHornbach in Germany.Joint Venture and Associate sales are not consolidated.All percentage movements below are in constant currencies. Rest of Europe sales increased 18.6% to £345.0 million (+10.1% LFL) with 13 morestores trading compared to the same quarter last year. Retail profit was £41.7million, reflecting continued strong growth in Poland and Turkey offset by £2million of higher pre-opening costs, and weaker performances from CastoramaItaly and Hornbach (21% economic interest) in a difficult German market. Sales for Castorama and Brico Depot in Poland were up 24.5% to £194.1 million(+18.3% LFL), boosted by strong consumer spending in a buoyant constructionmarket. Castorama Italy sales declined 3.4% to £83.0 million (-3.5% LFL) in aretail market that continues to be generally weak. Trading at Brico Depot Spain and Castorama Russia continued to be encouragingand Koctas in Turkey, a 50% joint venture, continued to perform well. During Q3, four stores opened, including two in Poland (one Brico Depot), one inIreland and one in Italy. A further eight stores are planned for Q4. ASIA Retail sales £m 2007/08 2006/07 % Change % Change % LFL (Reported) (Constant) ChangeAsia 122.7 115.6 6.1% 8.6% 0.4% Retail profit £m 2007/08 2006/07 % Change % Change (Reported) (Constant)Asia (4.6) 3.6 n/a n/a Asia includes China, South Korea and Taiwan JV (sales not consolidated).All percentage movements below are in constant currencies. Asia sales increased 8.6% (+0.4% LFL) to £122.7 million. B&Q China sales growth of 10.5% was driven by six new stores trading compared tothe same period last year and LFL growth of +0.4%, impacted by a slowdown of newapartment sales in the major Chinese markets. Losses of £4.0 million reflect thelower sales growth and the impact from new regulations covering trading termsbetween retailers and suppliers highlighted at the interims. One new storeopened during Q3 taking the total to 60 with a further two planned for Q4. B&Q Taiwan, a 50% joint venture, delivered a small profit and, as previouslyannounced, the exit from South Korea was completed in the quarter. The twostores have now closed. Enquiries: Ian Harding, Group Communications Director 020 7644 1029 Nigel Cope, Head of Communications 020 7644 1030 Sarah Gerrand, Head of Investor Relations 020 7644 1032 Further copies of this announcement can be downloaded from www.kingfisher.com orby application to: The Company Secretary, Kingfisher plc, 3 Sheldon Square,London, W2 6PX. Company Profile Kingfisher plc is Europe's leading home improvement retail group and the thirdlargest in the world, with over 775 stores in 10 countries in Europe and Asia.Its main retail brands are B&Q, Castorama, Brico Depot and Screwfix. Kingfisheralso has a 21% interest in, and strategic alliance with, Hornbach, Germany'sleading large format DIY retailer, with over 120 stores in Germany and eightother European countries. DATA BY COUNTRY as at 3 November 2007 Store numbers Selling space Employees (000s sq.m.) (FTE)B&Q 324 2,358 26,589UK Trade 86 26 2,312Total UK 410 2,384 28,901Castorama 98 972 12,157Brico Depot 89 477 6,438Total France 187 1,449 18,595Poland 39 316 7,318Italy 28 173 2,115Ireland 8 51 573Spain 10 51 641Russia 4 37 1,254Turkey JV 12 67 1,549Total Rest of Europe 101 695 13,450China 60 566 10,017Taiwan JV 21 97 1,854Total Asia 81 663 11,871Total 779 5,191 72,817 NINE MONTHS - 39 weeks to 3 November 2007 Retail Sales £m (1) % Total % LFL Retail Profit £m (2) % Total 2007/08 2006/07 Change Change 2007/08 2006/07 Change (Reported) (Reported)UK (3) 3,406.4 3,218.9 5.8% 1.1% 130.3 141.9 (8.2)%France (4) 2,470.5 2,295.3 7.6% 3.1% 194.0 172.1 12.7%Rest of Europe (5) 957.6 754.1 27.0% 14.6% 103.1 93.5 10.3%Asia (6) 349.8 324.6 7.8% 2.8% (15.6) (3.0) n/aTotal 7,184.3 6,592.9 9.0% 3.5% 411.8 404.5 1.8% (1) Joint Venture (JV) and Associate sales are not consolidated.(2) Retail profit is stated before central costs, exceptional items, acquisition intangibles amortisation and share of joint venture and associate interest and tax.(3) B&Q, Screwfix and Trade Depot.(4) Castorama and Brico Depot.(5) Rest of Europe includes Poland, Italy, Spain, Ireland, Russia, Turkey JV and Hornbach in Germany.(6) Asia includes China, South Korea and Taiwan JV. This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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