Trading at DIY retailer Kingfisher (KGF) wasn't as robust as these half-year reported figures suggest. That's because they were flattered by the outcome of a French tax case, which netted £145m for the group. Adjust for that, and various other exceptionals, and pre-tax profit actually fell 1.6 per cent to £365m, driven by a 4.8 per cent fall in retail profit and a 0.8 per cent slide in underlying group sales - reflecting weak consumer conditions across most of the group's markets.
In the UK, Ireland and France which, combined, generate around 80 per cent of group revenue, profits fell and same store sales dipped across all businesses - apart from Screwfix, where underlying revenue rose 3.6 per cent. Buoyed by the success of that business, management is to trial the Screwfix model in Germany this year. However, progress on slimming down the clunky B&Q estate was excruciatingly slow. One freehold site was sold and planning permission to reconfigure a further 15 could take six to 18 months. What's more, share buybacks appear to be off the agenda - management reckon there isn't the net surplus capital to support it.
Cantor Fitzgerald expects full-year per-tax profit of £755m, giving EPS of 23.1p (2013: £715m/22.3p).
| KINGFISHER (KGF) | ||||
|---|---|---|---|---|
| ORD PRICE: | 410p | MARKET VALUE: | £9.73bn | |
| TOUCH: | 410p-411p | 12-MONTH HIGH: | 422p | LOW: 261p |
| DIVIDEND YIELD: | 2.3% | PE RATIO: | 13 | |
| NET ASSET VALUE: | 271p* | NET CASH: | £259m | |
| Half-year to 3 Aug | Turnover (£bn) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2012 | 5.48 | 364 | 11.1 | 3.09 |
| 2013 | 5.72 | 401 | 18.7 | 3.12 |
| % change | +4 | +10 | +68 | +1 |
Ex-div: 9 Oct Payment: 15 Nov *Includes intangible assets of £2.6bn, or 110p a share | ||||
