B&Q owner Kingfisher’s profits topped £1bn - a feat only achieved by two other UK retailers, Tesco and Marks & Spencer.
(Picture: PA Wire)B&Q and Screwfix owner Kingfisher became only the third UK retailer in history to surpass the £1 billion profit mark today as its boss pledged to keep battling rivals on price amid the cost-of-living squeeze.
The firm said that pre-tax profits last year nudged over the £1 billion mark — an achievement only matched by Tesco and Marks & Spencer in the UK retail sector — as a pandemic-era DIY boom continued even after lockdown restrictions eased. It is handing £550 million back to investors.
Thierry Garnier, chief executive, said profits and sales of £13 billion for the year to January 31 were records in Kingfisher’s 40-year history.
But there are signs the home improvement boom that propelled it to such heights may have already peaked: sales so far this trading year are down 8% on last, though still 16% above where they were this time two years ago.
Garnier pledged to keep battling rivals on price as the cost of living crunch hits customers. Kingfisher expects the home improvement surge to continue even amid rising inflation.
“In times of crisis, DIY is a good place to be as people want to save money and so they do things themselves,” he said.
Roughly 45% of Kingfisher’s sales are own-brand products, which Garnier said were less inflation sensitive. It can “rapidly flex” costs to keep a lid on prices if it needs to.
The company compares its prices with those of rivals on a weekly basis and Garnier said the company was in a “great situation”.
Staff wages have gone up by 6.5% at B&Q and 5.4% at Screwfix, while a share plan that gives staff one share for every one they purchase has been relaunched.
The stock initially jumped to the top of the FTSE 100 before falling more than 5% to the bottom of the index.
Elsewhere, Garnier said the firm was now trialling 27 compact stores in retail parks, high streets and within supermarkets.
As part of the firm’s “rightsizing” strategy, it will cut the size of 40 of its largest B&Q and Castorama stores by roughly 30% in the next 10 years. Excess space will be used for ‘dark stores’ that service online orders or offered to another business, such as a “food discounter to bring additional traffic to the site,” Garnier said.
