B&Q owner lifts targets as sales boosted by weather and Homebase closures

Home improvement giant Kingfisher has upgraded its profit and cash guidance after it was buoyed by strong UK trading for B&Q and Screwfix.

The retail group said B&Q sales were “strong” over the past six months after they benefited from the closure of Homebase stores – following its rival’s administration – and “favourable weather” conditions.

As a result, the group reported a rise in profits and said they are set to reach the “upper end” of current targets.

Kingfisher told shareholders on Tuesday that pre-tax profits grew by 4.1% to £338 million for the half-year to July 31, compared with a year earlier.

It said it is on track to report an adjusted profit at the “upper end” of its guidance of between £480 million and £540 million for this financial year.

The London-listed business also said it now expects to deliver a cash flow between £480 million and £520 million, upgrading its previous guidance of between £420 million and £480 million.

The improved targets came on the back of stronger sales across the group’s brands, particularly in the UK.

Total group sales grew by 0.8% to £6.81 billion for the six months, with like-for-like sales rising by 1.9%.

Like-for-like sales were up 3.9% in the UK, driven by growth of 4.4% in B&Q and 3% in Screwfix across the half-year.

There was increased demand for paint, with sales of coloured emulsion up 10% at B&Q, alongside a further recovery in demand for big-ticket items.

This was driven by “demand for new kitchen ranges” and bathroom and storage products.

It represents a continued recovery in demand for larger products after it had cooled in the face of the surging cost of living.

Kingfisher also told investors that its UK stores were boosted by “transference from the closure of Homebase stores”.

Major B&Q rival Homebase shut more than 50 stores by March of this year after tumbling into administration late in 2024.

Thierry Garnier, chief executive officer of Kingfisher, said the company saw a “good transfer” of former Homebase customers to its B&Q stores and cheered the opening of eight former Homebase shops as new B&Q sites.

He said the stores, which included five in the UK and three in Ireland, have performed strongly after a quick turnaround to reopen during the peak trading season.

The company said it has also worked to offset significant cost pressures this year, with around £145 million of headwinds linked to higher National Insurance contributions, wage inflation, new UK packaging taxes and increased social taxes in France.

In the UK, earlier this month B&Q confirmed plans to cut around 650 jobs in a management shake-up amid efforts to streamline its operations but bosses stressed this was not linked to increases in National Insurance.

Mr Garnier added: “We delivered a strong first half with high quality underlying like-for-like sales growth of 1.9%, driven by increased volumes and transactions.

“We were encouraged by underlying quarter-on-quarter growth in our core categories, and a third consecutive quarter of growth in big ticket sales.

“Our expectations for our markets for the year remain consistent with what we outlined in March, whilst mindful of mixed consumer sentiment and political uncertainty.

“Combined with our first-half performance, this gives us the confidence to upgrade our full-year profit and free cash flow guidance and to accelerate our share buyback programme.”