Kingfisher announces final results for the year ended 31 January 2016

  • Sales up 3.8% and retail profit up 7.4%, in constant currencies
  • Adjusted pre-tax profit of £686m, up 0.3%
  • Good early progress on the journey to ‘ONE’ Kingfisher

LONDON, 2016-Mar-25 — /EPR Retail News/ — 2015/16 Financial overview:

% Total Change % Total Change % LFL* Change
2015/16 2014/15 Reported Constant currency Constant currency
Adjusted sales* £10,331m £10,605m (2.6)% +3.8% +2.3%
Retail profit* £746m £742m +0.7% +7.4%
Adjusted* pre-tax profit £686m £684m +0.3%
Adjusted basic EPS 22.0p 21.3p +3.3%
Full year dividend 10.1p 10.0p +1.0%
Lease adjusted ROCE* 12.3% 11.9% +40bps
Net cash* £546m £329m n/a

* Throughout this release ‘*’ indicates the first instance of terms defined in Section 5 ‘Glossary’ of this announcement.

  • Total adjusted sales in constant currencies up 3.8% (France +1.2%; UK & Ireland +5.6%; Other International +4.8%)
  • Retail profit in constant currencies up 7.4% (France (1.6)%; UK & Ireland +18.0%; Other International +6.4%)
  • Adjusted pre-tax profit of £686m driven by strong UK profit growth, impacted by £46m adverse foreign exchange movements on the translation of non-sterling retail profits
  • Returned £432m of cash to shareholders (£232m dividend; £200m buyback)

ONE Kingfisher highlights:

  • Delivered solid progress on our first ‘sharp’ decisions e.g.
    • First wave of unifying our ‘core essential’ ranges to land in stores for customers from March 2016
    • On track to close c.15% B&Q surplus space by end of FY 2016/17 (65 stores) in over-spaced catchments; exit of leases secured on 40 of the stores
    • Unified IT platform accelerated after successful Ireland pilot
    • Goods Not for Resale (GNFR*): first wave of unified spend (£350m) progressing well. On track to land FY 2016/17
    • Established new leadership team
  • Developed detailed 5 year transformation plan focusing on 3 key pillars:
    • Unified & unique offer
    • Digital
    • Operational efficiency
  • Set ambitious 5 year financial targets
    • Expected to deliver £500m sustainable annual profit uplift by end of year 5 over and above ‘business as usual’
    • Total expected cash cost of £800m (split between capex & P&L)
    • Intend to return c.£600m of capital to shareholders over the next 3 years (£50m returned since year end), in addition to the annual ordinary dividend
  • Set operational milestones for FY 2016/17

Véronique Laury, Chief Executive Officer, said:

“This has been a very productive and important year. We have delivered a good ‘business as usual’ result with both sales and profit growth in constant currencies, driven by our performance in Poland and the UK, driven largely by Screwfix, and a stable performance in France.

“We have also delivered solid progress on the first sharp decisions announced last year. I am really pleased with the focus and the energy that the team has demonstrated during the year.

“In addition, in January we revealed our ambition and our five year plan. By putting customer needs first we will, by the end of that period, deliver a £500 million sustainable annual profit uplift, over and above ‘business as usual’. It is an ambitious plan. However based on the solid progress so far, and the competence and enthusiasm of our colleagues, we feel very confident in our ability to deliver.”

Karen Witts, Chief Financial Officer, said:

“We have set ambitious and clear five year financial targets, which will drive a considerable increase in the value of our business for shareholders. We are tracking our progress against our financial and operational milestones, and we will update as we progress.

“Our balance sheet remains strong, enabling us to continue to invest in the business and in the transformation, whilst also returning surplus capital to shareholders, in addition to the ordinary annual dividend.

“In the short term, the fundamentals of the UK economic backdrop remain positive, although we remain cautious on the outlook for France. The outlook for the wider global economy remains uncertain, and the impact of the outcome of the UK EU referendum is unknown.”

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Statutory reporting

2015/16 2014/15 % Change Reported
Statutory sales* £10,441m £10,966m (4.8)%
Statutory pre-tax profit £512m £644m (20.5)%
Statutory post-tax profit £412m £573m (28.1)%
Basic EPS 17.8p 24.3p (26.7)%

Contacts:

Investor Relations Director
+44 (0) 20 7644 1029

Media Relations
+44 (0) 20 7644 1030

Brunswick
+44 (0) 20 7404 5959

Further copies of this announcement can be downloaded from www.kingfisher.com or viewed on the Kingfisher IR iPad App available for free at the Apple App store. We can be followed on Twitter @kingfisherplc.

Kingfisher American Depositary Receipts are traded in the US on the OTCQX platform:
(OTCQX: KGFHY) http://www.otcmarkets.com/stock/KGFHY/quote

Kingfisher preliminary results for the year ended 31 January 2015: Sales up 2.9%; UK & Ireland +5.5%

LONDON, 2015-3-31 — /EPR Retail News/ — Sales up 2.9%, adjusted pre-tax profit of £675m, down 7.5%. New CEO outlines plans to organise Kingfisher very differently and announces her first ‘sharp’ decisions on the journey to ‘ONE’ Kingfisher

2014/15 Financial overview:

% Total Change % Total Change % LFL* Change
2014/15 2013/14 Reported Constant currency Constant currency
Sales* £10,966m £11,125m (1.4)% +2.9% +0.5%
Retail profit* £733m £779m (5.9)% (1.6)%
Adjusted* pre-tax profit £675m £730m (7.5)%
Adjusted basic EPS 20.9p 22.8p (8.3)%
Full year dividend 10.0p 9.9p +1.0%
Net cash* £329m £238m n/a

* Throughout this release ‘*’ indicates the first instance of terms defined in Section 5 ‘Glossary’ of this announcement.

2014/15 highlights

  • Total sales in constant currencies up 2.9% (France -1.0%, UK & Ireland +5.5%, Other International +5.0%)
  • Adjusted pre-tax profit of £675m impacted by a slower market in France since summer 2014, £34m adverse foreign exchange movements on the translation of non-sterling profits and £22m charges for new country development activity
  • Year end net cash of £329m is after £275m capital investment and £434m of cash returned to shareholders
  • Appointed new Chief Executive Officer in December 2014, new initiatives underway on the journey for ‘ONE’ Kingfisher

Commenting on the strategic update:

Véronique Laury, Chief Executive Officer, said:

“Home improvement is a great market with huge potential and Kingfisher has a strong position within it with further scope to grow in a sustainable way. However, it is clear to me that we need to organise ourselves very differently to unlock our potential. This will involve taking what is essentially a locally managed set of businesses and creating instead a single, unified company where customer needs come first. The first step in developing this new organisation is the creation of a new, international leadership team with more focused cross-company roles.

“We have a lot to do and we are announcing today a set of first ‘sharp’ decisions which are already underway including the closure of around 15% surplus B&Q space (c.60 stores) and our few loss making stores in Europe, the development of unified garden and bathroom businesses and the start of a Big Box revitalisation programme across Europe.

“In addition, we will be developing our detailed plans for the wider reorganisation of the company as we progress on this exciting journey towards becoming ‘ONE’ Kingfisher.”

Karen Witts, Chief Financial Officer, said:

“We believe our plans will drive an increase in the value of our business for shareholders, with improved financial metrics through higher sales and lower costs, whilst at the same time optimising the generation and use of cash. Besides the growth in full year dividend, we are also pleased to be announcing today a further £200 million capital return during FY 2015/16 reflecting our confidence in our medium term prospects. In the short term, whilst we remain encouraged by the improving economic backdrop in the UK, we remain cautious on the outlook for France, our biggest market.”

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Related links

Statutory reporting

2014/15 2013/14 % Change Reported
Statutory pre-tax profit £644m £759m (15.2)%
Statutory post-tax profit £573m £710m (19.3)%
Basic EPS 24.3p 30.0p (19.0)%

Contacts:

Sarah Levy, Group Investor Relations Director
+44 (0) 20 7644 1032

Christian Cowley, Head of Investor Relations
+44 (0) 20 7644 1126

Nigel Cope, Head of Media Relations
+44 (0) 20 7644 1030

Giles Hartley, Investor Relations Manager
+44 (0) 20 7644 1082

Brunswick
+44 (0) 20 7404 5959

Further copies of this announcement can be downloaded from www.kingfisher.com or viewed on the Kingfisher IR iPad App available for free at the Apple App store. We can be followed on Twitter @kingfisherplc.

Kingfisher American Depository Receipts are traded in the US on the OTCQX platform: (OTCQX: KGFHY) http://www.otcmarkets.com/stock/KGFHY/quote