B&M looking to ease market jitters over new leadership
Press Association
INVESTORS will be looking for any forward-looking forecasts that they hope can lift B&M’s ailing shares as it reports its full-year results tomorrow.
The recently announced departure of the company’s long-term chief executive and his family’s reduction of their shares in the firm have weighed on London-listed shares.
It has meant that B&M, which is a budget retailer, has not seen the uplift on the market that some might have expected during the ongoing cost of living crisis.
Shareholders will be hopeful that the company can benefit from tightening belts as customers choose lower-priced alternatives to their usual shopping habits.
Shares are down by over a quarter compared to last year, said AJ Bell investment director Russ Mould.
He said that the Arora family’s decision to sell four per cent of the company’s shares and drop their stake to seven per cent might have “stoked a little unease amongst shareholders”.
“Then came the announcement in April that Simon Arora would quit as the company’s chief executive in spring 2023 after what will then be 18 years in the job,” he said.
He also pointed to poor showings for US retail shares, with worries that people might stop spending altogether instead of choosing cheaper alternatives likely weighing on shares.
“Either way, investors have shrugged aside January’s positive trading update… This raises the stakes for the full-year results and also any guidance that the company feels able to give for the year to March,” Mould said.
The Arora brothers, Simon and Bobby, took over the struggling local supermarket chain in 2004 and transformed it into an international business listed on the FTSE 100. The company had been founded in 1978, but it was not until the brothers built it into a discount retailer that it truly took off.