B&Q owner Kingfisher reveals its yearly profit dropped by more than a third

It made a statutory pre-tax profit of £307 million for the year to the end of January – 35 per cent lower than the year before.

Sales edged 0.2 per cent higher in the UK and Ireland, compared with the prior year, but were down 1.7 per cent across the group led by a 6.2 per cent decline in France.

So-called “big-ticket” items – referring to costlier things like kitchen and bathroom ranges, or larger home renovations – declined 4.4 per cent year-on-year.

Kingfisher has consistently flagged that many consumers have delayed buying big-ticket items as they tightened their belts amid the higher cost of living.

Sales nonetheless picked up over the final three months of the financial year, which it attributed to new ranges and campaigns at B&Q.

Screwfix sales were stronger in the UK and Ireland, reflecting demand from its trade customers, although slowed towards the end of the year thanks to milder weather affecting demand for electrical, plumbing, heating and cooling products.

Meanwhile, Kingfisher said it was preparing to reduce costs to help offset the impact of higher wages, taxes and inflation.

The higher rate of national insurance in the UK, and equivalent tax in France, was set to add £45 million to the group’s expenses next year.

London-based Kingfisher employed about 57,600 staff around the world at the end of the financial year.

Thierry Garnier, Kingfisher’s chief executive, said: “Looking to the year ahead, the recent government budgets in the UK and France have raised costs for retailers and impacted consumer sentiment in the near term.”

He said this means the company was “focused on what is in our control” like managing costs and growing its share of the DIY market.

“Kingfisher is in its best operational shape for years, and we remain confident about the growth opportunities in our business,” he said.

Richard Hunter, Head of Markets at interactive investor, commented “Kingfisher is still working to get its own house in order, and the results reveal once more where most of the repair work needs to be done. An underperforming French operation which accounts for 30 per cent of group sales saw a drop of 31.6 per cent in retail profit, which represents just 14 per cent of the total. The long-suffering Castorama unit, where pressure has been in evidence for some time, remains in focus as the group simplifies and modernises the store estate although this restructure is a slow burner.”