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Kingfisher shares drop after DIY retailer trims annual income outlook

Stock Markets Nov 24, 2022 19:22
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By Scott Kanowsky 

Investing.com -- Kingfisher PLC (LON:KGF) has marginally decreased the range of its predicted annual income, citing the impact of additional investments on its operations in France, higher wages, and elevated expenses.

In a statement, the British company behind home improvement retailers like B&Q and Screwfix said it now expects full-year pre-tax income to register between around £730 million to £760 million, down from a prior band of £730M to £770M.

"This includes additional P&L investments to strengthen our Screwfix France store opening plan, additional wage support for colleagues, and slightly higher energy costs," Kingfisher said.

Meanwhile, losses from its Screwfix International, NeedHelp, and other franchise agreements are now expected to come in at approximately £35M in Kingfisher's 2022/23 fiscal year.

Kingfisher added that it remains "mindful" of current macroeconomic uncertainty, promising to manage pressures from soaring inflation and control costs.

In a note to clients, analysts at Jefferies said the "slight trim" to Kingfisher's full-year income guidance was "a bit surprising."

But they pointed to the group's third quarter revenue uptick of 0.6% year-on-year to £3.26B as a sign of underlying resilience in customer demand, particularly in key markets like the U.K. and France, despite a surge in living costs.

Kingfisher chief executive Thierry Garnier noted that sales are being supported by "new industry trends such as working from home a clear step-up in customer investment in energy saving and efficiency."

Shares in the company fell in mid-morning trading on Thursday.

Kingfisher shares drop after DIY retailer trims annual income outlook
 

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