Kingfisher: share up as cash flow target raised

(CercleFinance.com) - Kingfisher has raised its free cash flow forecast for 2024 today, following better-than-expected H1 results, notably driven by market share gains in the UK.


Europe's leading DIY retailer, which operates the Castorama and Brico Dépôt banners in France, reported a 2% rise in recurring taxable profit to £324m for the six months to 31 July.

Adjusted profit was £334m, against a consensus of £290m.

At constant exchange rates, total sales fell by 2.4% to £6.75bn.

We note that these better-than-expected performances are mainly attributable to the UK and Ireland, RBC analysts said.

Results in France were in line with our estimate, while Poland was slightly ahead of expectations, the Canadian broker continued.

For Q3, Kingfisher is reporting a 0.3% decline in like-for-like sales at this stage, while RBC was forecasting a 1.8% decline.

Regarding its outlook, the British group now expects FY adjusted pre-tax profits of £510m-550m, with this range nudged up from £490m-550m to date.

It is also raising its FCF target to between £410m and £460m, compared with £350m to £410m previously.

Following this publication, Kingfisher shares rose by over 6% on Tuesday morning, making them the biggest gainer on the London Stock Exchange's FTSE 100 index.


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