Sir Ian Cheshire to be succeeded by Ms Véronique Laury as Kingfisher Group Chief Executive

LONDON, 2014-9-10 — /EPR Retail News/ — Kingfisher announces Group Chief Executive succession plan. Sir Ian Cheshire to be succeeded by Ms Véronique Laury, Chief Executive of Castorama France, before the end of the current financial year.

Kingfisher plc, Europe’s largest home improvement retailer, today announces that Sir Ian Cheshire will step down as Group Chief Executive before the end of the current financial year and retire from the Board on 31 January 2015.

This decision, reached during the regular succession discussions between the Board and Sir Ian, recognises that the next phase of Kingfisher’s evolution requires a significant leadership commitment and continuity. The next five years will be particularly busy as we deliver Group-wide best in class IT systems and omnichannel capabilities, expand Screwfix and Brico Dépôt into new markets, complete our common brands programme and, subject to completion, integrate Mr Bricolage with Kingfisher’s businesses in France.

With this in mind and with Sir Ian having already served 16 years in the business, 14 years on the Board and nearly seven as Group Chief Executive, all parties believed it was best to clarify succession sooner rather than later. Accordingly, Sir Ian will hand over the role of Group Chief Executive to Ms Véronique Laury following a hand over process in the coming months. Ms Laury has been with Kingfisher for 11 years and is currently Chief Executive of the Castorama business in France. She is a member of the Group Executive Committee and will join the Kingfisher plc Board ahead of taking up her new role.

Daniel Bernard, Kingfisher Chairman said: “It has been a pleasure to work with Sir Ian, and on behalf of the Board and our colleagues I want to thank him for his successful leadership. He has transformed Kingfisher into a stronger business with a bright future during a difficult economic time. During his tenure as Group Chief Executive Kingfisher’s reported sales grew 23%, adjusted profit before tax doubled and Kingfisher’s market capitalisation increased by £3.8 billion (+112%). Furthermore, £1.6 billion of financial net debt was eliminated leaving the business strong enough to commence a capital return programme to our shareholders in 2014, the first in Kingfisher’s history. He also leaves a strong sustainability legacy in Net Positive and an impressive management cadre throughout the business.

“Our strategy of making home improvement easier for our customers whilst creating competitive advantage from our international scale and know-how, known as ‘Creating the Leader’ is the right one and we are more determined than ever to successfully execute this strategy and deliver profitable growth for our shareholders. Following a rigorous review of candidates, internally and externally, the Board believe Ms Laury is uniquely qualified to lead the business on the next leg of its journey. She is an outstanding retailer, with 26 years’ experience of home improvement retailing in France and the UK. She is passionate about helping customers have better homes and we are delighted that she has agreed to provide the leadership, pace and drive to deliver our strategy.”

Sir Ian Cheshire, Group Chief Executive said “It has been a privilege to lead Kingfisher and I am proud of our achievements. My primary aim on becoming Group Chief Executive almost seven years ago was to deliver a step change in the value of the business for our shareholders and I am delighted that this aim has been achieved. Having taken over the leadership role in the depths of the financial crisis I am proud that the Kingfisher of today is a much stronger business, with a more profitable and sustainable model. I owe a huge debt of thanks to all the 79,000 colleagues worldwide who helped make this happen. Looking ahead we have a clear path to follow. Helping our customers to have ‘Better Homes, Better Lives’ whilst driving further international integration and expanding our reach will deliver profitable growth in the future. Now is the right time to hand over to a new leader and I am delighted that Véronique, who I have worked closely with for over 11 years and know is superbly qualified for the job, has agreed to take over from me. I wish her and all our colleagues across the Group continued success.”

Ms Véronique Laury, Group Chief Executive Designate said “Kingfisher is a strong business, well positioned in the home improvement market and I am delighted and honoured to be appointed as Group Chief Executive. Building on Sir Ian’s legacy we will reinforce our purpose to support those who want to improve their homes. In addition we will continue to create value for our shareholders.”

Notes to editors

Sir Ian Cheshire, joined Kingfisher in 1998 and joined the Board in June 2000. He has held several major roles including Director of Strategy & Development, CEO of e-Kingfisher, CEO International & Development and CEO B&Q UK & Ireland. He was made Group Chief Executive in January 2008. During his tenure as Group Chief Executive reported sales grew 23%, adjusted profit before tax increased 108% (from £357 million to £744 million) and Kingfisher’s market capitalisation increased by £3.8 billion (+112%). Over £1.6 billion of financial net debt was eliminated leaving the business financially strong enough to commence a capital return programme in 2014, the first in Kingfisher’s history. (Note: financial results cover the period 3 February 2008 to 1 February 2014. Market capitalisation figures reflect the period 3 February 2008 to 9 September 2014)

Ms Véronique Laury has worked in home improvement retailing for 26 years. She joined Kingfisher 11 years ago and has held several key roles including Commercial Director for Castorama France, where she was a key architect of the new ranges, new merchandising approach and modern store format that have made Castorama such a success. She has also been Kingfisher’s Group Commercial Director, where she developed and launched our Group-wide common own brands such as Blooma and MacAllister. And before returning to France as CEO of Castorama she was Commercial Director of B&Q UK & Ireland. Prior to joining Kingfisher she spent 15 years with other leading French DIY retailers.

Kingfisher plc is Europe’s leading home improvement retail group and the third largest in the world, with 1,157 stores in ten countries in Europe and Asia. Its main retail brands are B&Q, Castorama, Brico Dépôt and Screwfix. Kingfisher also operates the Koçtaş brand, a 50% joint venture in Turkey with the Koç Group.

Our unique contribution as a business to our customers is that we can harness our home improvement experience, our heritage as a leader in sustainability and our international scale to bring new, more sustainable and more affordable products to market. By also providing our customers with project advice and new shopping channels to complement our stores we will make it easier for them to adapt their homes to their evolving lifestyles. Our shorthand for describing this purpose is “Better Homes, Better Lives” and the programme of self-help initiatives to achieve this purpose is called‘Creating the Leader’.

Net Positive is our approach to business. We aim to have a positive impact on people and communities, be restorative to the environment, become carbon positive, waste nothing and create wealth.

The Group Executive Committee is responsible for the overall strategic decision-making of the Group. It currently consists of seven senior managers, including the Group Chief Executive who chairs the meetings.

ENQUIRIES

Ian Harding, Group Communications Director
+44 (0)20 7644 1029

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

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

Matt Duffy, Investor Relations Manager
+44 (0)20 7644 1082

Brunswick
+44 (0)20 7404 5959

Kingfisher reports half year total sales up 0.9% and flat adjusted pre-tax profits of £364 million

LONDON, 2014-9-10 — /EPR Retail News/ — Kingfisher reports half year total sales up 0.9% (+1.8% LFL) and flat adjusted pre-tax profits of £364 million after the negative impact of foreign exchange translation. Kingfisher also announces Group Chief Executive succession plan. Sir Ian Cheshire to be succeeded by Ms Véronique Laury, Chief Executive of Castorama France, before the end of the current financial year. See separate RNS.

Group Financial Summary

26 weeks ended 2 August 2014

% Total Change % Total Change % LFL* Change
2014/15 2013/14 Reported Constant currency Constant currency
Sales* £5,768m £5,716m +0.9% +4.6% +1.8%
Retail profit* (1) £390m £390m Flat +3.3%
Adjusted* pre-tax profit (1) £364m £364m Flat
Adjusted basic EPS (1) 11.3p 11.3p Flat
Statutory pre-tax profit £375m £401m (6.5)%
Statutory post-tax profit £277m £440m (37.0)%
Basic EPS 11.8p 18.7p (36.9)%
Interim dividend 3.15p 3.12p +1.0%
Net cash* £496m £259m n/a

*Throughout this release ‘*’ indicates the first instance of terms defined in Section 5 ‘Glossary’ of this announcement.
(1) 2013/14 comparatives restated to reflect disposal of Hornbach (see note 2 in part 2 to this announcement)

First half highlights in constant currencies:

  • Reported Group retail profit of £390m impacted by £12m adverse foreign exchange movements when translating overseas profits into sterling
  • Group retail profit ahead 3.3% in constant currencies, after development costs of £11m in our new markets – Portugal, Germany & Romania. Underlying retail profit, excluding these development costs, was up 6.0%
  • Total sales in France grew 0.4% and profit was flat. The ongoing slow economy and declining housing market impacted our performance, particularly for our more construction orientated Brico Dépôt business
  • UK & Ireland sales were up 6.6% (+4.4% LFL) and retail profit was up 17.7%, benefiting from initiatives to re-energise B&Q and better demand for trade products as housing construction and activity improved. The B&Q strategy update is on pages 8-9
  • In Other International markets sales grew 8.8% but profit growth in Poland, Turkey and Spain was offset by new country development costs and higher losses in China
  • Progress continued with our ‘Creating the Leader’ programme including entering a binding agreement to acquire the shares of the principal shareholders of Mr Bricolage, the French home improvement retailer, and opening today our first 4 Screwfix outlets in Germany with next day national delivery
  • The previously announced multi-year capital returns programme to shareholders, starting with £200m in FY 2014/15 commenced in H1. £100m was returned as a special dividend and £35m via a share buyback (8.5m shares)

Subsequent highlights:

  • Remainder of the capital returns programme will resume as a share buyback
  • At Q2 we indicated that we experienced a sharp market downturn in June and July in France and Poland (Castorama France -3.3% LFL; Brico Dépôt -7.2% LFL; Castorama Poland -4.7% LFL). Since then in August, one of our largest months, sales were better across both markets (Castorama France -0.6% LFL; Brico Dépôt France -4.3% LFL; Castorama Poland +3.3% LFL) and overall Group LFL was +0.3%

Kingfisher’s Group Chief Executive, Sir Ian Cheshire, said:

“This was a difficult first half with demand in our largest and most significant market, France, remaining particularly weak with a sharp market downturn experienced in our second quarter. We did though deliver flat profits in France, a resilient performance despite the difficult backdrop. However, conditions in the UK were more favourable with better weather and encouraging signs in the smaller tradesman market. We were able to capitalise on the better conditions with Screwfix performing particularly well growing sales by 23%. B&Q UK & Ireland also delivered their best H1 sales growth in over a decade as the new team start to gain traction with its re-energising initiatives and started to make progress with its plan to better position the business for the future.

“Looking to the longer term, we continue to work on our ‘Creating the Leader’ programme including opening Screwfix and Brico Dépôt stores in two new countries and accelerating the rebranding of the recently acquired Romanian business into the Brico Dépôt format. We remain convinced that investment today to develop the highly profitable Screwfix and Brico Dépôt formats into new markets creates a huge growth opportunity for Kingfisher.

“Whilst our French business saw an improvement in August we remain cautious about the economic backdrop and focused on trading effectively with continued self-help initiatives whilst continuing with our initiatives to build a long term, sustainable future for the business. We have a strong balance sheet and cashflow to enable the necessary investment in the future as well as paying a healthy dividend to our shareholders. I am pleased that we are also recommencing our share buyback.”

 

ENQUIRIES

Ian Harding, Group Communications Director
+44 (0)20 7644 1029

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

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

Matt Duffy, 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. Video interviews with Sir Ian Cheshire (Group Chief Executive) and Karen Witts (Group Finance Director) are also available on the website and we can be followed on Twitter@kingfisherplc with the interim results tag #KGFHY.

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

COMPANY PROFILE
Kingfisher plc is Europe’s leading home improvement retail group and the third largest in the world, with 1,157 stores in ten countries in Europe and Asia. Its main retail brands are B&Q, Castorama, Brico Dépôt and Screwfix. Kingfisher also operates the Koçtaş brand, a 50% joint venture in Turkey with the Koç Group.