DIYboost for owner of B&Q
B&Q owner Kingfisher yesterday beat City forecasts for its third quarter, boosted by a change of strategy in China and a renewed interest in home improvement.
The group said that pre-tax profits rose in the 13 weeks to 31 October to £227m, compared to £176m last year, ahead of expectations.
Kingfisher said that a revival in the popularity of DIY had offset a slumping property market, boosting like-for-like sales by 5.7 per cent.
The retailer, which has also profited from the demise of rival MFI, also said that sales of big-ticket items that have suffered in the recession were also faring well, with sales of kitchen appliances jumping by around 27 per cent.
And analysts were cheered by the group’s turnaround strategy at its Chinese division, which has been bleeding cash due to an ill-judged and rapid expansion.
The group has now closed 20 stores in China, narrowing losses to £7m from £17m the year before.
Finance director Kevin O’Byrne said the group had slashed its net debt to £0.2bn, a sharp decline from £1.8bn reported for last year.
Despite the strong set of numbers, chief executive Ian Cheshire said there was uncertainty over the impact of a general election due by June on the economy, which was clouding the outlook for 2010.