B&M’s (BME) amazing run continues, with a set of half-year results that defy wider retail industry trends. Like-for-like sales grew 7.5 per cent during the first half, accelerating considerably during the second quarter, helping to push cash profits up by a fifth. That largely reflected a stellar performance on home soil, following strong sales of food and other consumables such as toiletries and non-perishables. As such, management said it had bought more stock earlier than planned ahead of the third quarter and all-important festive trading period.
The trouble with this level of performance is that the market starts to split hairs. The group’s shares actually fell 2 per cent after management admitted the German Jawoll business could do with some attention. Profits there suffered due to weak summer trading, although it’s hoped that a newly installed division head come 1 December should help perk things up. Christian Mueller’s resume is certainly impressive, and analysts believe he brings specific experience with expansive new store opening programmes.
Analysts at Peel Hunt expect pre-tax profit of £244m for the year ending March 2018, giving EPS of 19.5p, compared with £190m and 14.9p in FY2017.
| B&M EUROPEAN VALUE RETAIL (BME) | ||||
| ORD PRICE: | 387p | MARKET VALUE: | £3.87bn | |
| TOUCH: | 386.8-387p | 12-MONTH HIGH: | 414p | LOW: 236p |
| DIVIDEND YIELD: | 1.4% | PE RATIO: | 25 | |
| NET ASSET VALUE: | * | NET DEBT: | 71% | |
| Half-year to 23 Sep | Turnover (£bn) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
| 2016 | 1.11 | 73.7 | 5.8 | 1.90 |
| 2017 | 1.35 | 86.8 | 6.8 | 2.40 |
| % change | +22 | +18 | +17 | +26 |
| Ex-div: | 23 Nov | |||
| Payment: | 22 Dec | |||
| *Negative shareholders' funds | ||||
