Hardware and DIY retailer Kingfisher (LON:KGF) saw its stock slide based on its third and fourth quarter sales.
The company boasts “strong performance across all retail banners and categories, with an overall footing and an increase in average trading value.” With sales of £3.5 billion, Kingfisher reported group-wide growth of 17.2% in the third quarter.
This led by B&Q, led by growth across all of the UK, French, Iberian, Romanian and Polish brands, and reported sales growth of 23.9% over the quarter. Kingfisher is also boosted by a notable new trend in consumer habits, e-commerce sales rose 153% in the third quarter, and now consists of 17% of all sales, collecting 216% by clicking – currently accounting for 77% of all e-commerce activities.
Similarly, similar sales growth continued in the fourth quarter, up 12.6%, “which largely reflects the impact of recent temporary lockdown measures.” Despite the lockdown, the company said all stores remain open.
With the weight of the balance sheet, Kingfisher repaid the £23 million received under the government’s employment retention scheme. Similarly, sales contracts in Russia rose 12.3% in the third quarter.
In addition to praise the company’s sales performance, CEO Thierry Garnier said: “At the same time, we have made good progress on the strategic priorities of ‘kingfisher driving’. We are grateful for our teams how our teams continue to address the big challenges of doing business in today’s environment. ”
“During this period, we promoted our commitment to supporting our community. We continued to create jobs in our stores. We continued to donate to our charity partners and health authorities. And earlier this month we paid back the £23 million we received in the first half under the UK government’s Furlough programme. While there remains a considerable amount of uncertainty in Covid-19, we are confident in our ability to operate safely, serve our customers, take care of our colleagues and protect our businesses.”
“Overall, we believe that our new focus on homes is supporting our marketplace. Furthermore, we believe that the strategic and operational actions we have taken so far will help us lay a strong foundation for long-term growth.”
Following what appears to be a positive renewal, Kingfisher shares fell 5.58% to a share of 282.60pa. This price is not the 321.40p high seen in October, but the analyst’s target price is about 7% ahead of the 254p per share.
Analysts currently have a “hold” consensus stance on equities. The P/E ratio of 39.12 is ahead of the average service sector 33.27. The MarketBeat community also currently has a “underperformance” rating of 59.95% on its stock.
