Kingfisher (KGF) may want to reconsider the shape of its French operations. Like-for-like sales fell 4.1 per cent during the third quarter, or 3.5 per cent even after including new store openings and a currency tailwind. Healthy third-quarter figures across its UK and Ireland business – where sales rose 2.5 per cent – were not enough to offset that weakness, with group like-for-like sales declining marginally.
The French home improvement market has been challenging in the past few years, but Kingfisher's businesses underperformed the wider industry during the period. Home improvement sales grew 0.6 per cent across the sector, according to the French central bank. That puts Kingfisher’s performance into stark contrast: sales at French home improvement businesses Castorama fell 2.6 per cent, with like-for-like sales of seasonal items down 9.3 per cent, reflecting strong comparative figures this time last year. Sales at its French DIY chain, Brico Dépôt, declined 5.2 per cent on a like-for-like basis.
But that’s not the only pain – the group also cited disruption from its ONE Kingfisher turnaround plan – largely to do with product availability and clearance ranges. Management also expects a surcharge to its tax bill of roughly €25m (£22m) following a legislative change in France, although it shouldn’t recur after this year.
At home, Screwfix continues to perform well, registering a 16.6 per cent rise in total sales or a 10.2 per cent underlying improvement. That was driven by better digital capabilities and new, more specialist ranges. Poland is also a growing international market for Kingfisher; sales there rose 6 per cent as the local home improvement market continues to evolve.
