Home improvement giant Kingfisher has reported a significant slump in profits, signalling a decisive end to the UK's pandemic-fuelled DIY boom. The parent company of retail chains B&Q and Screwfix saw its pre-tax profits fall by 22.5% to £317 million for the six months to July 31st.
The drop comes as consumers, squeezed by the rising cost of living, rein in spending on big-ticket home projects. Like-for-like sales across the group dipped by 0.6%, with a more pronounced 1.6% decline in its key UK and Ireland market.
A Tale of Two Brands
The performance of Kingfisher's two main brands highlighted the shifting market:
- B&Q: Sales fell by 1.8% as demand for garden products and building materials softened.
- Screwfix: The trade-focused brand proved more resilient, though sales still decreased by 0.3%.
In contrast, the company's international operations offered a glimmer of hope, with sales in France and Poland growing by 1.9% and 2.9% respectively.
Navigating a New Normal
Chief Executive Thierry Garnier acknowledged the challenging transition. "Our industry is facing a period of softer market demand after several years of strong growth," he stated. The company is responding by focusing on market-share gains, enhancing its digital services, and maintaining a tight control on costs.
Despite the profit dip, Kingfisher confirmed its financial outlook for the full year remains unchanged, pointing to a stable balance sheet and a share buyback programme of £300 million. However, the results clearly indicate that the era of unprecedented DIY spending has cooled, forcing the sector to adapt to a new economic reality.
