Kingfisher, Europe's largest DIY group, is facing some problematic situations. Its French market is especially worrisome, but the group has basically only established growth in its British home territory.
3.6 % turnover drop
Kingfisher, which owns B&Q and Screwfix in Great Britain and Castorama and Brico Depot in France, experienced a 3.6 % turnover drop in its third quarter. It announced a 2.82 billion pounds (3.56 billion euro) turnover in a trading update this morning. Profit dropped nearly 12 % to 225 million pounds (284 million euro), down from the 271 million pound profit it managed in the same quarter last year.
Basically, Kingfisher is only doing well in its own home territory of Great Britain and Ireland, with a 5 % turnover increase to 1.148 billion pounds (1.45 billion euro) and an 11 % profit growth. Particularly Screwfix is doing well, with a like-for-like 13.1 % growth.
France is struggling the most with a 9.3 % turnover drop (- 2.7 % at level exchange rates). With 1.064 billion pounds (1.34 billion euro), it has even lost its position as Kingfisher's primary market, something that will not change anytime soon according to the board. In the rest of the world, its turnover dropped 7.4 % and profit even plummeted 33 %, but the impact rather smaller as the rest of the world only contributes a fifth of total turnover.
Véronique Laury, Kingfisher France's CEO, will have her work cut out for her when she succeeds Ian Cheshire on 8 December and become the group's CEO. Kingfisher is the world's third largest DIY chain, trailing 2 American companies: Lowe's and Home Depot.