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Kingfisher, the parent company of B&Q and Screwfix, has announced a poor quarter of sales in its latest trading update.
Total sales slumped by 3.2%, in what CEO Thierry Garnierd called a “disappointing” result. Like-for-like sales were also down 3.7% for the quarter.
Kingfisher said that disruption from new product ranges, lower promotional activity and tough market conditions accounted for this weakened performance. Operational issues in France also affected overall figures, with French divisions reporting a 6.2% fall in sales.
B&Q UK and Ireland sales tumbled 3.5%, and like-for-like sales were down 3.4%.
Kingfisher said UK sales were impacted by the discontinuation of showroom installation services, and the introduction of new ranges across its lines.
Screwfix fared better than its counterpart, enjoying a rise of 7.9% in sales, whilst like-for-like sales increased 3.4%.
The company said that Screwfix “continued to strengthen its overall customer proposition, including ongoing price investment”, and nodded to future expansion for the division in the upcoming quarter.
Commenting on the results, Garnier said: “It is clear that there is much to do to improve our performance. Kingfisher’s trading during Q3 was disappointing.
“My early assessment is that we have not found the right balance between getting the benefits of Group scale and staying close to local markets.”
He added: “We are suffering from organisational complexity, and we are trying to do too much at once with multiple large-scale initiatives running in parallel Altogether, this has brought disruption to sales and has distracted the business from focusing on customers.”
The company acknowledged that changes must now be made to fix operational issues, with particular focus on improving IT systems and supply chain issues in France. A “number of initiatives” will also be stopped in order to focus on stabilising performance and trading.
“The effect of these changes will not be immediate,” added Garnier.
“We are building a longer term plan to refocus on our customers, simplify our model, embrace digital and return our business to growth. I look forward to providing an update on the business and our strategic priorities in March, within our full year results.”
