B&Q owner Kingfisher cuts profit forecast

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Kingfisher has cut its annual profit forecast as the home improvement retailer faced tougher markets in Poland and France, sending its shares down more than 5 per cent.

The retailer, which owns the do-it-yourself chain B&Q in the UK and Castorama in France, said on Tuesday that pre-tax profits for the year would be £590mn, below a previous target of £634mn.

Chief executive Thierry Garnier said the guidance had been cut “to better reflect our performance in [the first half] and the trading environment in our markets”.

Despite “good growth” in the UK, he said, “we face . . . a weaker trading environment in Poland, while consumer confidence in France is at a 10-year low”.

The group’s like-for-like sales in the first half were 2.2 per cent below last year while third-quarter sales were so far down 2.4 per cent.

Garnier, who has been spearheading a turnaround of the home improvement group, said in March that he expected inflationary pressures facing the company would ease in the second half as some costs, including shipping, came down.

The company on Tuesday said it remained positive on the medium-to-long term outlook and “confident in our ability to grow market share and deliver our medium-term financial objectives”.

Kingfisher also announced a new £300mn share buyback programme, following £600mn of buybacks in the past two years.