Kingfisher, Europe's largest home-improvement retailer, reported first-half profit that beat estimates, as growth in France offset lower UK sales and the company saved money by getting more goods direct from suppliers.
Adjusted pretax profit rose 24 per cent to £439 million, the London-based retailer said in a statement today.
The company, which is behind the B & Q brand, is to create 1,200 jobs in Britain this year, spending £130 million on new stores, particularly for its building trade-focused Screwfix brand.
Kingfisher gets about 40 per cent of sales from France, where the growth of its Castorama and Brico Depot chains is helping offset declining consumer spending in its other main market, the UK.
The retailer is buying common ranges across all countries for products like outdoor furniture, and building its own-brand line as it seeks to reduce expenses. "The stock is undervalued considering these results and the company's international spread of activities," Freddie George, an analyst at Seymour Pierce, said in a note today.
He raised his recommendation on the retailer to "buy" from "hold" and increased his full-year earnings
estimate.
Kingfisher rose as much as 12.9 pence, or 5.4 per cent, to 252.5 pence in London trading and was up 5.1 per cent this morning, the biggest gainer in the FTSE 100 Index. The stock has slipped 4.4 per cent this year on concern about declining consumer spending in some of the company's European markets.
The retailer gets about two-thirds of profit outside the UK.
Reuters
:quality(70)/cloudfront-eu-central-1.images.arcpublishing.com/irishtimes/6BDEAESQEJH4BHNFRSVZH3W4TM.png)