TIDMKGF
RNS Number : 3150L
Kingfisher PLC
11 January 2021
Kingfisher plc
Q4 pre-close trading update
11 January 2021: Kingfisher plc ('Company', 'Group' or
'Kingfisher') is today providing an update on Q4 trading to
date.
Q4 trading to 9 January
As announced on 19 November 2020, Kingfisher's Q3 20/21 Group
LFL (1) sales were up 17.4%, while Q4 20/21 Group LFL sales (to 14
November) (2) were up 12.6%.
Since then, Kingfisher has continued to experience strong demand
across its markets with Q4 20/21 Group LFL sales (to 9 January
2021) (3) up 16.9%. Financial year to date (1 February 2020 to 9
January 2021), Group LFL sales are up 6.5%.
Based on trading to date, the Group is comfortable with the top
end of the range of current sell-side analyst estimates(4) for FY
20/21 adjusted profit before tax.
Operational status
While our c.1,380 stores remain open for in-store purchasing and
click & collect, under strict social distancing and safety
protocols, recent restrictions imposed within the United Kingdom
and Republic of Ireland mean that some discrete areas of certain
B&Q stores have been temporarily closed. For further detail on
this and the current lockdown restrictions in each of our markets,
as of 11 January 2021, please refer to the 'Supplementary
information' section below.
LFL sales by month in Q4 (to date)
Monthly sales % LFL(1) Change
--------------------
Nov 2020 Dec 2020
--------------------- --------- ---------
UK & Ireland +24.0% +20.8%
France (0.1)% +29.4%
Other International +1.3% +11.6%
- Poland +0.2% +9.7%
- Iberia(5) (6.3)% +20.6%
- Romania(6) +17.4% +12.5%
Group LFL(7) +11.4% +22.1%
--------------------- --------- ---------
E-commerce sales(8) +155.4% +154.3%
Overall, Q4 20/21 Group LFL sales (to 9 January 2021) are up
16.9%, supported by e-commerce sales growth of over 150%.
The slower growth in November, relative to Q3 and December,
largely reflects the impact in France of a negative calendar effect
year on year (c.-5% impact on LFL sales), the closure of certain
ranges within stores during the November lockdown, and the less
favourable trend for trade-oriented business versus general home
improvement, due to the stringent restrictions in France.
Sales growth in December accelerated, helped by significantly
stronger growth in France (in both Castorama France and Brico
Dépôt) post the November lockdown. The UK & Ireland continued
to perform strongly in December, with growth at Screwfix
accelerating from November. Screwfix is on track to reach GBP2
billion of total sales in FY 20/21.
LFL sales by week in Q4 (to date)
Sales: 4 weeks to % LFL(1) Change
----------------------------------------------
28 November 2020 week 1(9) week 2(9) week 3(9) week 4(9)
--------------------- ---------- ---------- ---------- ----------
UK & Ireland +31.6% +17.3% +24.0% +30.3%
France (5.6)% +8.2% +10.6% +3.9%
Other International +2.8% +5.8% +2.4% (4.5)%
- Poland +1.6% +7.6% +4.3% (7.4)%
- Iberia (2.5)% (8.5)% (9.4)% +3.2%
- Romania +19.1% +16.6% +7.4% +5.4%
Group LFL(7) +13.1% +12.0% +15.5% +14.7%
--------------------- ---------- ---------- ---------- ----------
E-commerce sales(8) +144.2% +155.9% +163.7% +165.4%
Sales: 6 weeks % LFL(1) Change
to
-----------------------------------------------------------
9 January 2021 week week week week week week
5(9) 6(9) 7(9) 8(9) 9(9) 10(9)
----------------- -------- -------- -------- -------- -------- ---------
UK & Ireland +17.9% +20.2% +23.0% +23.6% +23.2% +14.4%
France +28.2% +26.7% +26.7% +13.1% +26.8% +15.9%
Other
International +7.1% +13.9% +8.5% +5.7% +4.9% +22.7%
- Poland +3.1% +15.5% +6.7% +4.7% +1.0% +26.0%
- Iberia +18.1% +15.1% +18.7% +5.5% +23.6% +11.3%
- Romania +18.9% +1.1% +8.9% +13.5% +7.5% +19.9%
-------- -------- -------- --------
Group LFL(7) +19.5% +21.2% +21.1% +15.6% +21.3% +16.2%
----------------- -------- -------- -------- -------- -------- ---------
E-commerce
sales(8) +135.7% +150.9% +152.1% +215.6% +155.8% +149.9%
Thierry Garnier, Chief Executive Officer, said:
"The safety of our customers and teams remains our first
priority while we fulfil the essential needs of our customers. We
will continue to support our colleagues during these most difficult
times, and I want to express my sincere appreciation for all our
teams as they continue to operate in such a challenging
environment.
" While the strength of our Q4 trading, to date, is reassuring,
uncertainty over COVID-19 and the impact of lockdown restrictions
in most of our markets continue to limit our visibility. Longer
term, we are confident that the strategic and operational actions
we are taking are building a strong foundation for sustainable
long-term growth. We also believe that the renewed focus on homes
is supportive for our markets.
"We look forward to providing a more detailed update within our
FY 20/21 results on 22 March 2021. In the meantime, I wish you all
a happy and safe New Year."
Supplementary information
FY 2020/21 Technical guidance
Significant updates to our previous guidance are noted below in
italics.
Income statement:
-- Sales outlook
- Uncertainty over COVID-19 and the impact of lockdown restrictions
-- Costs
- Anticipate that FY 20/21 adjusted profit before tax will
include c.GBP85m of non-recurring cost savings, net of any one-off
COVID-related costs
- COVID-related costs(10) - expected to be c.GBP45m, which
includes one-off and recurring elements
- Central costs - expected to be c.GBP58m (FY 19/20: GBP62m)
- UK and Republic of Ireland business rates - as previously
announced, Kingfisher will forego all business rates relief for the
20/21 tax year. c.GBP130m of Kingfisher's annual business rates
bill was eligible for this relief, of which c.GBP110m would have
fallen in FY 20/21
- Furlough - no claims under furlough programmes in the UK
(including the Job Retention Bonus) and France since 1 July; repaid
UK furlough benefit received in H1 20/21 (c.GBP23m) in November
2020
-- Net finance costs
- Expected to be in line with prior year (FY 19/20: GBP173m,
before exceptional items) due to incremental financing costs for
PGE, CCFF and RCFs, offset by impact of reduced lease liability
-- Adjusted profit before tax
- Comfortable with the top end of the range of current sell-side analyst estimates(4)
-- Tax rate
- Group adjusted effective tax rate expected to be c.23%(11) (FY 19/20: 26%)
-- Exceptional items
- Expect to record c.GBP15-20m of restructuring costs in H2
20/21 in relation to the Group's new commercial operating model (as
announced in September 2020)
Cash flow:
-- PGE - in December 2020, the Group repaid its French Term
facility in full, including c.GBP549m of capital and c.GBP3m of
interest
-- Capital expenditure - gross capex of c.GBP280m (FY 19/20:
GBP342m); c.GBP70m of further expenditure deferred into FY
21/22
-- Tax - incremental one-off cash impact this year of c.GBP50m
from HMRC accelerated UK corporation tax payments
Previously announced 11 store closures in France:
-- All 11 stores now closed:
- 3 stores closed in France (1 Castorama, 2 Brico Dépôt) in H2 19/20
- 4 Castorama stores closed in H1 20/21
- 4 further Castorama stores closed in H2 20/21 to date, of
which 2 are to be converted to Brico Dépôt stores (opening in FY
21/22)
-- All cash costs of closures in FY 20/21 fully provided for in previous periods
Operational status by market
All our c.1,380 stores remain open for in-store purchasing and
click & collect, under strict social distancing and safety
protocols. The current lockdown restrictions and operational status
in each of our markets, as of 11 January 2021, is noted below.
Country Lockdown restrictions Essential retail Kingfisher commentary
status
England National lockdown Building merchants All B&Q and Screwfix
restrictions in place and suppliers of stores open. B&Q showrooms
from 5 January, including products and tools closed in line with
non-essential retail used in building government requirements.
closures work and repairs, Virtual design appointments
and garden centres, available
classified as essential
---------------------------- ------------------------- ---------------------------------
Scotland National lockdown Building merchants All B&Q and Screwfix
restrictions in place and suppliers of stores open. B&Q showrooms
from 5 January until products and tools closed in line with
at least 31 January used in building government requirements.
work and repairs Virtual design appointments
classified as essential available
---------------------------- ------------------------- ---------------------------------
Wales National 'Tier 4' Hardware retail All B&Q and Screwfix
restrictions in place essential stores open. B&Q showrooms,
from 20 December; garden centres, and
to be reviewed every discrete areas of non-essential
three weeks products closed in
line with government
requirements. Virtual
showroom design appointments
available
---------------------------- ------------------------- ---------------------------------
Northern National lockdown Hardware retail All B&Q and Screwfix
Ireland from 26 December for essential stores open
six weeks; to be reviewed
after four weeks
---------------------------- ------------------------- ---------------------------------
Republic 'Level 5' restrictions Hardware retail All B&Q and Screwfix
of Ireland from 24 December with essential. No 'January stores open. B&Q garden
non-essential retail sales' permitted centres closed in line
closures from 31 December; for essential retail with government requirements
to be reviewed on
12 January
---------------------------- ------------------------- ---------------------------------
France National lockdown Hardware retail All Castorama and Brico
ended on 15 December; essential during Dépôt stores
curfew from 8pm-6am previous lockdown open
(6pm-6am in certain
regions)
---------------------------- ------------------------- ---------------------------------
Poland National restrictions Hardware retail All Castorama stores
in place until 17 essential open. Limit on the
January. Closure of number of people allowed
non-essential retail in stores
from 28 December
---------------------------- ------------------------- ---------------------------------
Romania Some national restrictions Hardware retail All Brico Dépôt
in place 'tolerated' stores open
---------------------------- ------------------------- ---------------------------------
Spain National state of Hardware retail All stores open, with
emergency declared essential in Asturias, restrictions in certain
25 October. 17 regions Aragón and areas (such as reduced
have power to impose Andalusia, but not opening hours, space
additional, varied in other regions open to the customer,
restrictions and limits on the people
allowed in stores)
---------------------------- ------------------------- ---------------------------------
Portugal National state of Hardware retail All stores open, with
emergency in place essential. No national restrictions in certain
store closures areas (such as reduced
opening hours and limits
on the number of people
allowed in stores)
---------------------------- ------------------------- ---------------------------------
Footnotes
(1) LFL (like-for-like) sales growth represents the constant
currency, year on year sales growth for stores that have been open
for more than one year.
(2) 'Q4 20/21 Group LFL sales (to 14 November)' represent the
period from 1 November 2020 to 14 November 2020 (compared against
the equivalent period in the prior year, from 3 November 2019 to 16
November 2019). The figures are provisional and exclude certain
non-cash accounting adjustments relating to revenue
recognition.
(3) 'Q4 20/21 Group LFL sales (to 9 January 2021)' represent the
period from 1 November 2020 to 9 January 2021 (compared against the
equivalent period in the prior year, from 3 November 2019 to 11
January 2020). The figures are provisional and exclude certain
non-cash accounting adjustments relating to revenue
recognition.
(4) According to Company-compiled consensus estimates as of 4
January 2021, the current range of sell-side analyst expectations
for FY 20/21 adjusted profit before tax is GBP667m to GBP742m.
(5) Brico Dépôt Spain and Portugal.
(6) Kingfisher's subsidiary in Romania prepares its financial
statements to 31 December. Its monthly results presented are for
October and November, i.e. one month in arrears. The weekly results
presented have no corresponding delay.
(7) Group LFL includes total e-commerce sales and excludes Koçta
(Kingfisher's 50% JV in Turkey).
(8) E-commerce sales are total sales derived from online
transactions, including click & collect. This includes sales
transacted on any device, however not sales through a call centre.
E-commerce sales change covers the total Group.
(9) Weekly sales figures are for the Sunday-to-Saturday weeks
from 1 November 2020 (compared against prior year
Sunday-to-Saturday weeks from 3 November 2019). The figures are
provisional and exclude certain non-cash accounting adjustments
relating to revenue recognition.
(10) Includes costs of PPE and social distancing, donations, new
store layouts, additional store security, and bonuses to frontline
store staff.
(11) Subject to the blend of profit within the Group's various
jurisdictions.
Information contained within this announcement is deemed to
constitute inside information as stipulated under the Market Abuse
Regulations No. 596/2014. Upon the publication of this
announcement, this inside information is now considered to be in
the public domain. This announcement is being released on behalf of
Kingfisher by Paul Moore, Company Secretary.
Contacts
Tel: Email:
Investor Relations +44 (0) 20 7644 investorenquiries@kingfisher.com
1082
Media Relations +44 (0) 20 7644 corpcomms@kingfisher.com
1030
Teneo +44 (0) 20 7420 Kfteam@teneo.com
3184
About Kingfisher plc
Kingfisher plc is an international home improvement company with
approximately 1,380 stores, supported by a team of 79,000
colleagues. We operate in eight countries across Europe under
retail banners including B&Q, Castorama, Brico Dépôt, Screwfix,
TradePoint and Koçta . We offer home improvement products and
services to consumers and trade professionals who shop in our
stores and via our e-commerce channels. At Kingfisher, our purpose
is to help make better homes accessible for everyone.
Forward-looking statements
You are not to construe the content of this announcement as
investment, legal or tax advice and you should make your own
evaluation of the Company and the market. If you are in any doubt
about the contents of this announcement or the action you should
take, you should consult a person authorised under the Financial
Services and Markets Act 2000 (as amended) (or if you are a person
outside the UK, otherwise duly qualified in your jurisdiction).
The financial information referenced in this announcement is not
audited and does not contain sufficient detail to allow a full
understanding of the results of the Group. Nothing in this
announcement should be construed as either an offer or invitation
to sell or any offering of securities or any invitation or
inducement to any person to underwrite, subscribe for or otherwise
acquire securities in any company within the Group or an invitation
or inducement to engage in investment activity under section 21 of
the Financial Services and Markets Act 2000 (as amended).
Certain information contained in this announcement may
constitute "forward-looking statements" (including within the
meaning of the safe harbour provisions of the United States Private
Securities Litigation Reform Act of 1995), which can be identified
by the use of terms such as "may", "will", "would", "could",
"should", "expect", "anticipate", "project", "estimate", "intend",
"continue", "target", "plan", "goal", "aim" or "believe" (or the
negatives thereof) or other variations thereon or comparable
terminology. These forward-looking statements include all matters
that are not historical facts and include statements regarding the
Company's intentions, beliefs or current expectations and those of
our Officers, Directors and employees concerning, amongst other
things, the Company's results of operations, financial condition,
changes in global or regional trade conditions, changes in tax
rates, changes to customer preferences, liquidity, prospects,
growth and strategies, acts of war or terrorism worldwide, work
stoppages, slowdowns or strikes, public health crises, outbreaks of
contagious disease, environmental disruption or political
volatility. By their nature, forward-looking statements involve
inherent risks, assumptions and uncertainties that could cause
actual events or results or actual performance of the Company to
differ materially from those reflected or contemplated in such
forward-looking statements. For further information regarding risks
to Kingfisher's business, please consult the risk management
section in the company's Annual Report (as published). No
representation or warranty is made as to the achievement or
reasonableness of and no reliance should be placed on such
forward-looking statements.
The Company does not undertake any obligation to update or
revise any forward-looking statement to reflect any new information
or change in circumstances or in the Company's expectations.
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