Sales flat at Kingfisher

2nd Dec 2010 07:06

The UK & Irish operations of Kingfisher were a drag on sales growth in the third quarter, as the DIY retailer reported an 8.2% year on year increase in retail profits.Sales in France in the third quarter were up 0.8%, or 3.1% in constant currency, from a year earlier to £1,123m. Like for like (LFL) sales in constant currency terms rose 1.8%.Sales in UK & Ireland fell 3.8%, or 3.7% in constant currency terms, to £1,051m. LFL sales growth in constant currency terms was negative, at -4.2%.Kingfisher said the UK & Irish business was going up against its toughest year on year comparative figures in 14 quarters.The Other International division saw sales rise 6.3% to £517m. In constant currency terms the rise was 2.8% but on a LFL basis sales fell 1.1%.In total, sales eased 0.1% from a year earlier (+0.3% using constant exchange rates) to £2,691m. LFL sales were down 1.2% year on year.Retail profit rose 5.9%, or 8.2% in constant currency terms, to £240m from a year earlier. This fell well short of Investec's estimate of £255m.Net cash at the end of October was £203m, up from £19m at the end of the second quarter (31 July 2010). With some capital expenditure projects now likely to fall into the next financial year the group expects to remain net cash positive at the year end.The group's recovery programme in China remains on track, while trading in Poland is starting to stabilise after a difficult first half."Right across the group our sourcing initiatives and scale are increasingly being brought to bear to improve our customer offer and enhance our profitability," said Ian Cheshire, group chief executive."We enter our fourth quarter in good shape and with our Delivering Value plans remaining on track. We are well prepared to trade effectively in these challenging times and we continue to lay solid foundations for sales and profit growth in the future," Cheshire added.