Following today’s release of Kingfisher’s figures for the three months ending 30th April 2024; Jamel Boughedda, retail analyst at GlobalData, a leading data and analytics company, offers his view: “Kingfisher nudged ahead of last year’s Q1 with a 0.3% growth in total sales to £3.3bn on a constant currency basis, driven by an improvement in its Polish, Iberian and Romanian markets and continued gains from trade. The UK & Ireland business grew by 2.7% and was driven by trade, with a like-for-like (l-f-l) sales increase of 8.5% in TradePoint, which saw penetration reach 23%. TradePoint’s trade-only deals and strengthened services are translating into building a larger customer base with TradePoint now having 3.5m members. With trade set to remain buoyant and Wickes aiming to add members to its TradePro, this is a key battleground for Kingfisher.
“A 6.4% uplift in Screwfix sales showcases the retailers’ success as it continues to open new outlets and make notable gains in tools & hardware and building & joinery. Screwfix also saw a 2.4% uplift on a l-f-l basis showcasing the demand for its proposition as investments in its online offer (Screwfix Sprint and mobile app) continues to resonate with consumers. Its new Screwfix Spares offer, which focuses on appliance spares, accessories and consumables, has also helped and contributed to 2% of its growth.
“B&Q marginally increased, growing 0.4%, as the retailer was able to maintain growth despite a challenging consumer environment. This helped the retailer stay on course to meet its ‘flat’ growth expectations for FY2024/25. Investment in B&Q’s e-commerce platform has further boosted its already successful marketplace, with e-commerce sales penetration increasing to 13.6% from 11.4% in the prior year quarter, as consumers are able to benefit from the wider range found online. B&Q’s potential expansion of its marketplace by adding international products to the platform will only further enhance the range on its site. The next step for B&Q and marketplace will involve transitioning shoppers from its marketplace to its own products, to further enhance its sales, with big-ticket goods remaining weak as consumers continue to be impacted by the cost-of-living crisis. For comparison, Wickes l-f-l sales were down 4.2% in the 16 weeks to 20 April as larger ticket purchases remained subdued with the retailer also being supported by trade with its TradePro sales up 12%.
“Kingfisher’s international performance recovered from a rather challenging FY2023/24, with other international sales (which is predominantly Poland, Iberia, Romania) growing 2.4%, reflecting a strong performance for its non-French markets which increased by 7.0%. Kingfisher has been further improving its offer in Romania and Poland, developing its trade proposition, and rolling out trade loyalty programmes to fuel additional spending from consumers. However, France has remained challenging, with Q1 sales declining 5.1%, following a 5.8% decline in FY2023/24.
“Its French market has hit a crossroads, with the simplification of its businesses now completed, while also expanding Screwfix stores in France as it aims to develop its trade offer. Kingfisher has aimed to improve the performance of its weaker stores in France over the long-term, with three rightsizing and refurbishments completed to date, but with continuous declines and its French market being a significant portion of sales, it must pick up pace to claim quick wins this financial year. It is vital that Screwfix’s expansion in France does not limit the growth of Castorama or Brico Depot, especially within trade, which saw sales decline by 5.5% and 4.7% respectively this quarter.”
