Cash flows in as Kingfisher profits rebound

25th Mar 2010 07:05

B&Q and Castorama chain owner Kingfisher raised its dividend for the first time in five years as profits bounced back in 2009. Debt also tumbled and the group has now expanded its capital investment plans.Chief executive Ian Cheshire said that while the group remains cautious on the outlook for consumer demand across Europe, "Recognising our improved profitability, cash generation and future growth prospects I am delighted that the final dividend payment will be increased, the first dividend growth for our shareholders in five years." Total sales from on continuing businesses grew 4.8% to £10.5bn on a reported rate basis, and 1.1% on a constant currency basis. On a like-for-like basis, group sales were down 1.5%.Underlying profit rose by 49% to £574m from £368m, with pre-tax profits up 90% to £566m, before one-offs.Retail profit before exceptional items grew by 32% to £664m and by 75% to £681m including exceptional items. Profitability, cash generation and return on capital all grew in the UK & Ireland, France, Poland, Turkey and Spain, Kingfisher said, while losses were significantly reduced in China as the turnaround plan progressed. Debt at the year-end fell to £250m from £1bn and the gross capital investment budget for 2010/11 has been increased to around £400m. The final dividend also rises by 5.1% to 3.575p, with a total for the year of 5.5p, up 3.3%.