B&Q store closures and currency issues drag down profits at Kingfisher

B&Q owner Kingfisher has posted a 20.5% fall in annual statutory pre-tax profits to �512million.

B&Q owner Kingfisher has posted a 20.5% fall in annual statutory pre-tax profits to �512million. Photo: Paul Faith/PA Wire - Credit: PA

B&Q owner Kingfisher today reported a 20.5% fall in bottom-line profits as it counted the cost of an overhaul, but said that its restructuring plans were on track.

The group, which is axing stores and jobs within its B&Q chain in the UK and Ireland, posted a statutory pre-tax profit of £512million for the year to January 31, with an exchange rate hit also dragging the figure.

But with the impact of its restructuring and currency woes stripped out, group-wide underlying profits rose 0.3% to a better-than-expected £686m, helped by a robust UK trading performance.

UK retail profits jumped 18% to £326m, helped by further impressive sales growth at its trade-focused hardware arm, Screwfix.

However, the group said it remained “cautious” in respect of its business in France, where it trades as Castorama and Brico Depot, with sales under pressure amid weak consumer confidence and subdued housing and construction markets.

Kingfisher is halfway through an overhaul involving the closure of 65 B&Q stores and the loss of 3,000 jobs in the UK and Ireland, alongside plans to expand the burgeoning Screwfix business.

The group said that the first 30 B&Q stores have already closed, most of them the final three months of its financial year, with remainder to go by the end of next January.

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It recently unveiled plans to bolster annual profits by £500m over five years, although this will come at a one-off cost of £800m.

Veronique Laury, chief executive at Kingfisher, said the group’s revamp would succeed in ramping up profits by “putting customer needs first”.